Oracle's $16.5 billion AI data center in New Mexico encounters environmental challenges and rising costs

Huo Xing Finance reports that on July 19, according to The Information, Oracle’s $16.5 billion AI supercampus project, Project Jupiter, in New Mexico has encountered environmental approval obstacles, forcing it to revise its power supply plan and is expected to incur additional costs of billions of dollars. The campus spans 1,400 acres and is primarily designed to provide computing power for OpenAI, with a planned capacity exceeding 2 gigawatts. Oracle originally planned to build its own natural gas power plant, but permitting has stalled due to concerns over air pollution and greenhouse gas emissions. In April, the company switched to Bloom Energy natural gas fuel cells and adjusted its microgrid capacity to 2.45 gigawatts. Analysts estimate this solution will cost approximately $8 billion—billions more than the original natural gas turbine option. Last week, New Mexico again rejected the proposed fuel pipeline route, and the state’s environmental agency will hold a public hearing on air permits on October 19. The state’s attorney general is also investigating allegations that residents’ names were used without consent in support letters for the project. Oracle’s data center project in Wisconsin is also facing additional expenses; local regulatory rulings may require Oracle, OpenAI, and Vantage Data Centers to bear the full cost of transmission line construction independently, while another financial guarantee requirement is estimated by Oracle to add approximately $100 million in annual costs.