Pembina Pipeline said on Thursday it will go ahead with its planned C$4.6 billion ($3.24 billion) Greenlight Electricity Centre in Alberta, a project that will power the development of a major data center for an as-yet-unnamed customer.
The Calgary-based pipeline company announced a positive final investment decision on the Greenlight project, a 932-megawatt natural gas-fired power-generation facility to be located in Sturgeon County in central Alberta.
Pembina — which is partnering with Morgan Stanley Infrastructure Partners and Kineticor Asset Management — did not name the customer who will build the data center, but said the data center will be a first of its kind in Canada.
“Rapid growth in artificial intelligence and cloud computing is driving durable global demand for data center capacity and Alberta has positioned itself as an attractive jurisdiction for significant investment,” Pembina said in a release.
Canada currently has only five functioning data centers at the so-called hyperscale level, which means they demand at least 50 megawatts of electricity capacity, equivalent to the power needs of a small city. Nearly 100 other hyperscale data centers are in the works in Canada, and nearly 90% of those are planned for Alberta. The province has been touting its massive reserves of cheap natural gas in an effort to entice tech companies, including U.S. hyperscalers, to build data centers there.
Pembina said it already has a long-term tolling agreement in place with its data center customer, and expects the project to be in service by late 2030.
The project will require approximately 150 million cubic feet per day of natural gas, the company said, helping to create demand for Western Canadian natural gas producers.
(Reporting by Amanda Stephenson in Calgary and Pooja Menon in Bengaluru; Editing by Jonathan Ananda and Matthew Lewis)