Why Can’t AI Data Centers Power Up Immediately, Even Near Power Plants?

The expansion of AI data centers in South Korea highlights a critical infrastructure challenge: securing immediate electricity, even when a site is close to a power plant. The issue stems from the necessary infrastructure between the power generator and the data center, specifically transmission lines and substations. These act as distribution channels, similar to how pipelines deliver water from a supply facility, and must be capable of reliably delivering the required power.

Grid expansion projects, managed by entities like Korea Electric Power Corporation (KEPCO), operate on lengthy timetables distinct from building construction. KEPCO lists standard durations from six and a half to seven and a half years for 154-kilovolt (kV) facilities, and nine to nine and a quarter years for 345-kV facilities. These schedules encompass site selection, community consultation, permitting, land acquisition, construction, and inspections, meaning a data center building can be completed years before its power supply is ready.

This misalignment can lead to substantial costs for developers, who might face financing and maintenance expenses on a completed building that cannot yet generate revenue. It can also force rescheduling of server deliveries and customer occupancy. Therefore, a developer's claim of having "secured power" requires careful verification against the actual start date, initial supply capacity, and completion requirements for supporting grid works.

To mitigate these risks, developers are advised to assess electricity supply conditions early during site selection. This includes comparing potential delivery dates, the cost and scale of required grid works, and future expansion capacity. Phasing development, where a facility initially receives a partial power supply to begin operations, offers another strategy to match construction with power availability.