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Data Centers

Should Data Centers Go Seasteading?

With their reputation figuratively underwater, data centers might be going literally underwater too.

Elizabeth Nolan Brown | 9.14.2026 11:17 AM

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An illustration of an underwater data center | Illustration: Midjourney
(Illustration: Midjourney)

Hating data centers might be misguided, but it's also ubiquitous, at least in the U.S. And politicians have been capitalizing on this to score populist points by pushing through burdensome regulations. What's an artificial intelligence company to do?

Go seasteading, possibly.

"Some developers are now exploring the ocean as a new location for AI infrastructure in the hopes that underwater data centers could improve energy use and cooling efficiency while using less fresh water and land area than onshore buildings," writes University of North Carolina Greensboro management professor Nir Kshetri, who studies the social and environmental effects of emerging technology. He calls under-the-sea data centers "a promising new approach for supporting the growth of AI."

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Underwater data centers would be not technically be "seasteaders"—autonomous entities based far enough offshore that they're not subject to the rules of any government.

Even if underwater data centers could be based physically far enough from shore that they're not in anyone's national waters—not necessarily impossible, but impractical, costly, and a logistical nightmare—they would still be subject to various rules of international waters and would still need cables connecting them to land. They would also be run by tech companies based within an existing country's borders and subject to that country's oversight and regulations.

So while building underwater might solve some energy and land-use issues, it wouldn't solve what are gearing up to be the main barriers to data center construction: political animus and overregulation.

Microsoft has already shown that underwater data centers are not just possible but potentially better than their landlocked counterparts. From Kshetri:

In 2015, Microsoft launched a research project to explore the feasibility, benefits and challenges of underwater data centers. Part of that effort included setting up a waterproof data center on the seafloor near Scotland's Orkney Islands in 2018. It contained 864 servers and was connected to shore by an underwater cable.

After two years, Microsoft reported that the servers in the underwater data center failed at about one-eighth the rate of servers in comparable land-based data centers. The company is still studying the possible reasons but hypothesizes that in a sealed underwater environment the equipment is less exposed to oxygen, humidity and temperature fluctuations—as well as less jostling from people working to replace broken components.

Microsoft concluded that underwater data centers "are reliable, [are] practical and use energy sustainably." But it also ended this experiment in 2024 and hasn't started any more underwater data center since.

"The company didn't say why," notes Kshetri, "but others' analyses suggest the reasons could include regulatory concerns, including the need for environmental permits, as well as a desire for faster upgrades and replacements for the computer equipment inside."

It seems that people—not technology—could be the biggest obstacle to building more coastal data centers.

And if that's the case, we could miss out on a useful and environmental friendly innovation that enables technological progress while still respecting many communities' desires not to have data centers built in their backyards.

A wind-powered underwater data center in China, launched last year, "uses at least 30% less electricity than traditional data centers, and offshore wind turbines reduce reliance on fossil fuels and cut the data center's carbon emissions," Kshetri reports.

Floating data centers like those being tested in Japan and South Korea could also mean less land use and less resource-intense operations.

Moving data centers off shores does create "new concerns about harm to the marine environment," writes Kshetri. It's not yet clear "whether the ocean can become AI's next computing frontier without becoming its next environmental problem." But with the the right approach, he suggests, underwater data centers could "become sustainable alternatives to traditional data centers."

Some people are betting big money on that. For instance, Peter Thiel–backed Panthalassa, "a U.S.-based start up betting on ocean waves to power a fleet of floating data centers, announced $140 million in funding" in May, per Fortune magazine.

And federal regulators might not kill this sort of innovation before it takes off. In August, "the Federal Energy Regulatory Commission accepted DeepGreen Western Passage SPV's filing for a preliminary permit to build a $100 million underwater data center" off the coast of Maine, reports The Maine Monitor. "DeepGreen applied for the 48-month preliminary permit in February to conduct engineering and environmental studies required to secure funding and launch the project. This is not a permit for construction."

But animosity toward artificial intelligence could still stave off such experiments.

In Maine, DeepGreen's "application drew an almost immediate response from residents and Passamaquoddy officials, who strongly oppose the development, and prompted two citizen-initiated petitions designed to halt the proposal," notes the Monitor. "Earlier this month, the city council voted unanimously to enact a 180‑day moratorium, giving city officials time to review and possibly amend local zoning ordinances."


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>try to warn conservatives about runaway AI
>think up a strategy
>'What's something scary?'
>eureka!
>tell them agents are 'algorithmic immigrants' pic.twitter.com/5wsChzmERY

— Crémieux (@cremieuxrecueil) September 10, 2026

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"planning and prepping content to support what they called a 'soft war' or 'cognitive warfare' program."

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NEXT: AI Slowdown

Elizabeth Nolan Brown is a senior editor at Reason.

Data CentersArtificial IntelligenceSeasteadingScience & TechnologyTechnologyInnovationInfrastructureOceans
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  1. Rick James   2 months ago

    Even if underwater data centers could be based physically far enough from shore that they're not in anyone's national waters—not necessarily impossible, but impractical, costly, and a logistical nightmare—they would still be subject to various rules of international waters and would still need cables connecting them to land. They would also be run by tech companies based within an existing country's borders and subject to that country's oversight and regulations.

    Why ENB, it looks like I've taught you well, young padawan.

    1. mad.casual   2 months ago

      We need to unilaterally repeal whatever The Jones Act of data centers is so that more Chinese Nationals can operate our data centers more cost-effectively so that uh... [Googles] Brownsville-Harlingen... can be more digitally wealthy, like Boulder.

  2. Rick James   2 months ago

    ns—as well as less jostling from people working to replace broken components.

    I read this article and they way they performed this test isn't a very good real-world test of a datacenter, and therefore the "8x more reliable" figure is little more than a marketing slogan.

    Datacenters don't work the way Microsoft deployed this test. Datacenters aren't places that you put in sealed tubes and quietly monitor for a year, they're entirely dynamic places where components aren't just "replaced when broken" but upgraded, added-to, changed and removed or decommissioned.

    If every time someone needed to add a server, replace a hard drive, they had to bring the entire datacenter up to the surface, unseal it on a barge in an environment that won't contaminate the interior, remove/upgrade/add-to a component, then seal the whole thing and refill it with dry nitrogen, I guaran-damn-tee you underwater datacenters are going to be way more costly, way more expensive, and subject to a fuckton more... " jostling from people working to replace broken components"-- especially when you might have to perform these maintenance tasks in stormy seas.

    1. mad.casual   2 months ago

      I was thinking similarly about this after data center discussions (S. Korea funding nuclear specifically) last week.

      Our local HS sports stadium carries the name of the local car dealership's family. One of three prominent ones in the village. I can't count the number of autoparts stores (outside the dealership), garages, and muffler stores in the area. All the result of auto industry.

      For all the talk about investments in communities and generating jobs, unless they're building reactors to power Foxconn assembly lines too, data centers may as well be underwater or on the moon. One of our colocations is 85% empty. The staff of close to 100 that use to run it is down to less than 50 and turns over frequently. Mostly security pogues. Like a 30 yr. old computer, most of the infrastructure is becoming obsolete by modern standards. At least sports stadiums support local bars and attract tens of thousands of people every once in a while. Data centers are like resource extractors exporting their margins to wherever people are working from home from (assuming most of it isn't women gooning to their AI boyfriends).

    2. chemjeff radical individualist   2 months ago

      Well yeah, which is why no sane person would design an underwater data center that way. It would probably be more like: when a part failed, just turn the device off and then replace the part according to a regularly scheduled maintenance window (perhaps every 6 months or so). That means you'd need more redundancy, but if the components do in fact last longer due to the local environment, you wouldn't need as much redundancy as you might think.

      1. Rick James   2 months ago

        but if the components do in fact last longer due to the local environment, you wouldn't need as much redundancy as you might think.

        It's not that you can't build a datacenter environment that extends the life of your components... for instance, seal it in a tube and fill it with dry nitrogen-- like Microsoft did.

        But having things like air that humans can breathe, lighting, rack access and all that other boring stuff that people need in a real, no-shit production environment, then a sealed tube filled with dry nitrogen suddenly becomes exactly what it is: A laboratory test that doesn't imitate real world conditions in any way shape or form... just a proof of concept that shows that servers can run in a dry-nitrogen sealed tube, under water, and then monitored for a year for longevity and performance.

  3. damikesc   2 months ago

    Should these companies ever concern themselves with how they will EVER be profitable? They still are unable to monetize their creations enough to remotely come close to covering the costs.

    1. charliehall   2 months ago

      I have no idea why all these tech stocks are valued so highly.

      1. damikesc   2 months ago

        It has a bit of a tech bubble vibe to it.

  4. JFree   2 months ago

    Cool. So we can combine donor-dependent centralized AI with techbros and Reason ethics - and a dose of private mercenaries from SPECTRE.

  5. Neutral not Neutered   2 months ago

    Must have far higher build and start up costs. Dealing with Salt water has it's costs and issues. Maintenance. And we have real world information collected from previous under water attempts showing it is not viable.

    The idea it is running only on windmills is fiction due to intermittency. But when did that stop the lie about windmill and solar power being the only source not needing any other generation?

    1. Nelson   2 months ago

      “ Dealing with Salt water has it's costs and issues.”

      Always. But I assume that’s why they replaced the atmosphere. I wonder if it would work with a different gas environment or if the think nitrogen is the only cost-effective (or effective, period) environment.

      “ The idea it is running only on windmills is fiction due to intermittency. But when did that stop the lie about windmill and solar power being the only source not needing any other generation?”

      But that wasn’t what they said, is it? They talked about decreasing, not replacing, the non-renewable energy consumption.

      I don’t think anyone has suggested renewables, as of now, can replace fossil-fuel-generated energy. It’s the goal, but isn’t possible presently.

  6. Thoritsu   2 months ago

    Sure with nuclear power. Build them and sink them.

  7. mad.casual   2 months ago

    The "government mandated girlfriend" meme is back.

    Take this quick 10-question survey on dating and politics (Americans only)

    Damned "algorithmic immigrants", man! Fucking up our Cosmo/buzzfeed-style internet polls.

  8. Liberty_Belle   2 months ago

    Did anybody think putting heated elements in the water long term was a bad idea that might cause the dreaded "unforeseen damage" ?

    Remember when great coral reef bleached and started dying over 1 degree Celsius ? You aren't going to heat a whole ocean in an appreciable timeframe, but localized heat pollution can still adversely affect marine life.

  9. creech   2 months ago

    Data centers are too scary and even evil (at least until after the midterm). Let the Chinese build and control them. Surely, we can trust the Chinese to never use them against us.

  10. Eeyore   2 months ago

    Until you get a leak.

  11. Nelson   2 months ago

    An angry, Bible-quoting woman makes unfounded pedophilia accusations, asks a brown man if he is even in the country legally, and says he’s going to burn in hell.

    Man, if there is a more spot-on representative of today’s GOP I can’t imagine what it would be.

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