China

The STARGATE (Sustainable, Transparent Architecture for Grid-Interactive Energy Technologies) initiative plans to build up to 20 large AI data centers in the U.S., with an initial investment of $100 billion and plans for up to $500 billion by 2029. STARGATE-funded projects focus on carbon-aware computing, grid-interactive load management, and energy transparency to shift data centers from passive energy consumers to potential grid assets. The DOE's Loan Programs Office (LPO) has over $400 billion in lending authority for clean energy infrastructure, including data center-related grid or storage upgrades. The Bipartisan Infrastructure Law (BIL) and the CHIPS and Science Act of 2022 further support grid modernization, broadband expansion, and sustainable semiconductor manufacturing.

The United States has also implemented various environmental and energy regulations affecting data center operations. Laws like the Clean Air Act (CAA) and Clean Water Act (CWA) set standards for emissions and wastewater discharge, while the Resource Conservation and Recovery Act (RCRA) and CERCLA govern hazardous waste and site contamination relevant to e-waste and construction. Energy-specific policies like the Energy Policy Act of 2005, Energy Independence and Security Act of 2007, and the Energy Star Program promote energy efficiency and smart grid participation for data centers. Federal initiatives like the Federal Data Center Consolidation Initiative (FDCCI) and executive orders (e.g., EO 13834, EO 14008) mandate greenhouse gas reductions and a transition to clean energy in federal data centers. The National AI Research Resource Task Force Act of 2020 emphasizes sustainable energy use in AI infrastructure. Complementary programs like the Better Buildings Initiative and Clean Energy to Communities (C2C) offer technical and policy support to improve energy efficiency and accelerate clean energy adoption in data center-hosting communities. More recently, the Artificial Intelligence Environmental Impacts Act of 2024, introduced at the federal level, calls for a comprehensive evaluation of AI's environmental footprint.

Table 3: Comparison of Data Center Regulatory Landscape by Country in North and South America

Country

Market & CAGR

Advantages

Challenges

Regulations & Policies

United States

$50.56B, 10.7%

1. Home to many innovation hubs

2. Strong investors

1. Aging energy grid infrastructure

2. Land Permits

3. Connectivity issues in rural areas

1. No comprehensive policies

2. State-level approaches

3. Incentives differ based on location

Brazil

$5.63B, 5.82%

1. Large domestic market

2. Clean, cheap and diversified energy sources

3. Vast land availability and low real estate costs

4. Wealth of water resources for cooling

1. Unreliable energy sources in rural area

1. Brasil Mais Digital

2. AI Bill

3. Lei de Informática

Export to Sheets

7.2 China

The information industry is a vital sector in China, with IT infrastructure management and data center services highly encouraged. China has introduced various laws, regulations, and industrial policies for the data center field, standardizing practices and driving growth. China's digital economy ranks second globally, with a steadily expanding digital industry. As of December 2024, China's Internet users reached 1.105 billion, an increase of 16.08 million compared to December 2023, with an Internet penetration rate of 78.6%. Continuous growth in Internet users and data traffic will consistently drive the development of China's IDC (Internet Data Center) industry from the demand side. The construction of new information infrastructure like 5G and gigabit optical networks, widespread adoption of digital applications, and deep integration of the digital economy with the real economy will create vast market opportunities for the domestic IDC industry.

According to the Telecommunications Regulations of the People's Republic of China, telecommunication services are classified into basic telecommunication services (providing public network infrastructure, data transmission, and voice communication) and value-added telecommunication services (utilizing public network infrastructure for telecom and information services).

The Ministry of Industry and Information Technology (MIIT) is the primary regulatory authority for China's telecommunications industry, working with Communications Administration Bureaus in each province, autonomous region, and municipality. This dual management system places MIIT at the core, overseeing the vertical management of these offices. The Bureau of Telecommunications Administration within MIIT regulates telecom and information services, proposes market policies, manages market access, oversees service quality, ensures universal service, safeguards national and user interests, formulates interconnection and settlement methods, manages network codes, Internet domain names, addresses, and other resources, coordinates international cooperation, directs emergency communication for disaster relief, and handles wartime communication preparations. Provincial Communications Administration Bureaus supervise the telecom industry within their jurisdictions, including planning, industry management, licensing, spectrum and code allocation, and price and quality supervision. Therefore, companies involved in IDC-related businesses must obtain a Value-Added Telecommunications Business License from the relevant Communications Administration Bureau, or a Cross-Regional license from MIIT if operating in multiple provinces.

Nationally, data centers are often located near developed regions with high data demand in China. However, recent policies in first-tier cities like Beijing, Shanghai, and Guangzhou have made it difficult for IDC resources to meet rapidly growing demand due to increasing energy consumption requirements. To address this, the "East Data West Computing" project was launched in early 2022 by the National Development and Reform Commission, the Cyberspace Administration of China, MIIT, and the National Energy Administration. This initiative involves constructing eight national computing power hub nodes and planning ten national data center clusters to build an integrated national big data center system.

Specific initiatives include:

• August 2017: MIIT issued a notice supporting the establishment of national new industrialization demonstration bases, prioritizing industrial Internet, data centers, big data, cloud computing, and industrial transfer cooperation.

• February 2019: MIIT, National Government Offices Administration, and National Energy Administration jointly released "The Guiding Opinions on Strengthening the Construction of Green Data Centers," aiming to improve green development, accelerate technological innovation, and establish a green standard evaluation system. The goal was for newly built large and mega data centers to achieve a PUE below 1.4 by 2022.

• March 2020: MIIT issued a notice to accelerate the construction of national industrial internet big data centers and encourage cross-regional establishment.

• December 2021: NDRC, Cyberspace Administration of China, MIIT, and National Energy Administration jointly released the "Implementation Plan for Promoting Green and High-Quality Development of Data Centers and 5G and Other New Infrastructure to Meet Carbon Peak and Carbon Neutrality Goals." This plan mandated a PUE below 1.3 for newly built large and mega data centers nationwide by 2025, and below 1.25 for national hub nodes, with a green and low-carbon level of 4A or higher.

• Recent years: China's first-tier cities have imposed stricter regulations. For example, Beijing classified data centers as restricted industries in its 2022 Catalog of Prohibited and Restricted Industries. Shanghai formulated "Shanghai Internet Data Center Construction Guidelines (2019 Edition)" to standardize planning, site selection, construction, safety, and energy efficiency. These policies have limited IDC service provider expansion in first-tier cities.

• Early 2022: The "East Data West Computing" policy was officially implemented, completing the overall layout design of the national integrated big data center system.

• February 2023: The Central Committee of the Communist Party of China and the State Council issued the "Overall Layout Plan for the Construction of Digital China," emphasizing strengthening digital infrastructure, optimizing computing power layout, and promoting efficient complementarity between eastern and western regions.

• December 2023: NDRC and other departments released "Implementation Opinions on Deepening the "East Data West Computing" Project," highlighting the need to continue advancing green data center construction, intelligent energy management, and energy consumption monitoring.

In conclusion, China's digital economy and IDC industry have grown significantly, but stringent policies in first-tier cities have limited expansion. The "East Data West Computing" initiative and other national strategies aim to optimize computing resource distribution, promote green development, and foster a balanced and sustainable digital infrastructure.