Synapse Data Centre, Inc., has proposed the construction of a $10 billion Artificial Intelligence (AI) data centre in the rural town of Olds, Alberta.
The data centre is part of a provincial strategy that seeks to “[diversify] our economy, [expand] our role in global supply chains, and ensure our companies remain competitive and resilient” by increasing investment in technology and AI.
Alberta’s Minister for Technology and Innovation, Nate Glubish, claimed that “we’ve been hard at work trying to make Alberta a destination of choice in North America for this type of investment.”
The strategy assumes that the “abundant natural resources, cold climate, low corporate taxes, and reduced red tape” make Alberta the ideal environment for AI investment. The Narwhal reports that the natural gas-fired power plant would be the second-largest power plant in Alberta. This single data centre would produce a whopping 1.4 gigawatts of energy a day, which is comparable to powering the entire city of Edmonton.
Alberta’s Peak Energy and Water Usage Problems
The computer equipment in AI data centres runs hot, and cooling components require large amounts of water and electricity from local grids. This has been a major point of contention for residents sharing these grids and water sources.
According to the University of Calgary’s Office of Institutional Commitments, the Alberta Utilities Commission has made large-load grid connection requests of more than 16 gigawatts. This energy demand is far greater than the 12 gigawatts Alberta’s electricity grids can currently carry. In light of this, the Alberta Electric Systems Operator (AESO) has instituted a temporary 1,200 megawatt cap on major generation projects—which has already been reached by powering just two data centres. This leaves 37 proposed data centres AESO received applications for, requiring a total of 19 gigawatts (double the province’s generation capacity).
To cope with this, Alberta’s provincial government has proposed Bill 8, which requires data centre corporations to pay out-of-pocket for any upgrades to the electrical grid that would increase its capacity. According to CBC, the bill also introduces a levy for data centres consuming over 75 megawatts of power. This would reward companies that pay more corporate income taxes in Alberta rather than operating in other jurisdictions to minimize costs.
In addition to the large amounts of energy, “hyperscale” data centres, the largest ones used by major digital companies such as Google, can use up to 2.1 million litres of water daily. Even mid-sized centres can use nearly 1 million litres of water per day for cooling. Globally, data centres use a total of 140 billion litres of water a day just for cooling.
According to Synapse Data Centre’s own public communication, the Olds location will be using a closed-loop cooling system, “saving 100s of millions of litres per year.” The provincial strategy plan does state that data centres in cold climates require less water to keep cool, which makes Alberta a prime location for data centre investment. Despite immense water usage, air-cooling systems providing viable alternatives use even more power from fossil fuels. This demonstrates that no matter what is proposed to cool components, these data centres will consume excessive amounts of power and water, resulting in detrimental effects on the environment.
The Lasting Environmental Effects
Alberta’s strategic plan for AI data centres is vague, uses a lot of buzzwords like “sustainable,” but does not answer fundamental questions about how the scale of proposed data centres will have long-lasting effects on the environment.
Greenhouse gas emissions trap heat in Earth’s atmosphere, leading to rising temperatures and increased extreme weather worldwide, including hurricanes, wildfires, flooding, and drought. In Alberta, province-wide emissions have decreased by 27 megatonnes between 2005 and 2023, but establishing new AI data centres could undo that entirely. According to the University of Calgary, “if we rely on natural gas to power data centres without strict controls around emissions, a handful of data-centre projects could raise emissions levels to those of 20 years ago — when we burned coal to power the grid.” This can be disastrous, given the already ongoing climate crisis.
The Narwhal reported on Olds resident Janae Johnson’s concern about the air and noise pollution, the impact on wildlife, and how the lack of transparency did not convince her of its benefits. Olds’ town council has received dozens of letters from concerned citizens. “Has there been any consideration of the amount of emissions that the gas-fired power plant will create? How will wastewater be disposed of, as it will likely be contaminated?” Johnson stated to The Narwhal.
Another Olds resident, Marnie Desjardins, stated in a CBC interview, “I really thought that I would be retiring here, and I certainly had a vision of what that was going to look like. But I’m not sure …” The quiet life she had built, surrounded by “mature trees, interesting architecture, and friendly neighbours,” would be completely upended by the data centre and power plant proposal near her home.
Alberta is already feeling the effects of the climate crisis and global warming. Agriculture has struggled due to drought, as a lack of water has reduced nutrients in the soil. The risk of dust storms caused by dry, loose topsoil being carried away by wind has also increased. Additionally, Calgarians have faced water-use restrictions for the past several years due to reduced precipitation. Since Alberta is already experiencing drought, the construction of a new data centre would only exacerbate this by using even more of Alberta’s freshwater supply. It was even reported by Microsoft in 2023 that 42% of its water withdrawals for data centres were from areas already experiencing water stress.
Whether extracting from an already-scarce freshwater supply or raising Alberta’s provincial emissions, Alberta’s data centre investment plan would only contribute to a hotter, drier climate and further increase the risk of drought and dust storms.
Hotter, drier climates also increase the risk of wildfires, which are more frequent in places such as British Columbia, California, and Ontario. 2023 saw a record-breaking wildfire season in Northern Ontario and beyond, with 6,000 fires destroying more than 1.5 million hectares of land according to Natural Resources Canada. An article published in Nature Communications describes how over 200 entire communities were evacuated, and millions were exposed to hazardous air quality. Just two years later, Toronto was reported among the cities with the world’s worst air quality—again due to massive wildfires in Northern Ontario. The excessive water use requirements for data centres —and the emissions from the air-cooling systems designed to avoid the water use would only exacerbate this issue.
Despite these environmental concerns, the province of Alberta has not required the Synapse Data Centre to complete an environmental impact assessment. The Albertan mentions that impact assessments are needed “where a proposed industrial project could result in significant adverse environmental effects.” However, despite citizen concerns, Alberta Environment and Protected Areas has exempted the Olds proposal from this process.
Several other data centres in Alberta are also exempt, including the Wonder Valley AI Data Centre and Beacon AI Centers’ Indus and Heartland projects, all located in Alberta. The Impact Assessment Agency of Canada has exempted Beacon AI Centers’ projects federally.
The province of Alberta’s actions and communication throughout the AI data centre proposals have been clear: there is no concern for negative impacts on the environment or human life. There is only a desire for temporary job growth in engineering and construction sectors for these data centres, until AI is used to downsize those workforces.
Ontario is not Immune to Data Centres
As part of its $19 billion investment in Canadian data centre infrastructure, Microsoft is building new data centres across the province. This includes new facilities in both Mississauga and Vaughan. In fact, 41 per cent of data centres are in Ontario, and only 10 percent are in Alberta.
Even in Ottawa, Hydro Ottawa reports customer requests for 34 “large-load” data centre projects requiring a total of 1,075 megawatts of power, or 86 percent of Hydro Ottawa’s 2025 average system load. According to CBC, “most of these projects want to get connected within the next two years.” Hydro Ottawa CEO Bryce Conrad predicts that by the end of 2026, connection requests will exceed the total energy capacity used today in Ottawa. 60 per cent of these projects are data centres run by small generative AI companies, so it is easy to conceive the load that even one hyperscale data centre may require.
Unfortunately, regardless of size or location, Olds is not the only municipality where citizen concerns often go unheard. According to INsauga, Mississauga’s Anthony Ojosnicki wrote a letter to city council asking that the proposal be rejected until full disclosure regarding fuel type, noise levels, water consumption, and other details was provided, citing concerns about electricity and water consumption.
“Data centres can consume hundreds of thousands of gallons of water daily for cooling,” he wrote. “This draws from the same municipal system serving residents, risking higher rates and supply pressure during peak usage.”
Environmental concerns, particularly water and human impact, is causing growing backlash towards data centres. In May, hundreds marched in Metro Vancouver during public water restrictions and protested outside of a city planning in Hamilton.
As for the Synapse data centre project in Olds, a local advocacy group—The Olds Transparency Project—has been campaigning to raise awareness about the proposal.
“The town, province and residents have hosted several town halls and meetings to get people up-to-speed on the proposal and process,” says CBC. They went on to quote Karen Swanepoel, a resident who can see the site of the proposed data centre from her front yard. “I know more about AI data centres now than I ever wanted to know,” said Swanepoel. “It’s not something that we set out to learn about, but it’s infuriating that a lot of people don’t understand why we don’t think the risk is fair.”
At the national level, the advocacy group Council of Canadians has been fighting for collective access to clean water and, recently, against the rise of AI data centres. “It’s keeping water public, it’s defending water and protecting it,” Council of Canadians organizer Jessica Cheung told The Leveller. “People, planet, democracy—those are the things… at the core of what we do.”
Data centres’ heavy water extraction means that they have become a facet of Council of Canadians’ activism.
“…We hosted From the Ground Up, fighting data centers in Canada,” said Cheung. The Council produced a toolkit, Resisting Data Centre Development In Canada, to support activists “wanting to get organized and fight back.” The 40-page document describes how communities can get together, reach local politicians, and then work to stop municipalities from accepting AI data centre proposals.
“So any community who knows a data center is coming can use the toolkit to set the ground rules before it comes.”
Although data centres are typically built with disregard for both human citizens and the environment, there is still hope. The protest in Hamilton led the municipal planning tribunal to propose—and pass—a motion to deny Slate Asset Management’s data centre proposal. Manitoba Premier Wab Kinew refused Jet.AI and Consensus Core’s hyperscale data centre proposal in the town of Ritchot after a petition against it gained over 13,500 signatures. Cheung mentioned how the small Ontario town of Burk’s Falls organized to push back against a data centre proposal that was later taken off the table.
As Cheung described, the anti-AI data centre advocacy is more than highly visible protests, but rather the community-building that goes into opposing injustices. “Visible activism is… the tip of the iceberg. What supports that is this huge network that is unseen, right? Even if it’s things like, ‘I can offer meals, I can take care of your cat,’ these are really tangible ways that we can show up for each other to support people to naturally go where they want to go.”
“At the heart of it, that’s community,” she said.
However, data centre companies are not giving up: Synapse sent another application for a data centre proposal after an initial rejection by the Alberta Utilities Commission, while Slate Asset Management may appeal its rejection to the province of Ontario. Consensus Core CEO Wayne Lloyd was stated to have told CBC that the company is not giving up hope.
The rise of data centres could affect anybody next, even here in Ottawa. However, people across Canada have already proven that everyday citizens have the power to make their voices heard and prevail.
