[Reporter’s Notebook] Don’t Hold Back Plans to Build AI Data Centers

"Until now, chip (semiconductor) shortages have been a major constraint on artificial intelligence (AI) development, but in the next 1 to 2 years, power supply will become crucial." This is a post Elon Musk, CEO of Tesla, left on his social media platform X (formerly Twitter) last year. The power risk of generative AI he warned about is becoming a reality for companies in South Korea as well.

SK Telecom has identified AI data centers as a core future business and is currently preparing to build a 100-megawatt (MW) class AI data center in Ulsan City in collaboration with Amazon Web Services (AWS). AI data centers are known as "electricity-hungry hippos" because they operate servers 24/7 and must maintain constant internal temperature and humidity, resulting in high power consumption. In particular, a 100 MW-class center is classified as a "hyperscale" grade, typically built by American companies like AWS, Google, and Microsoft (MS).

However, SKT is gripped by a hidden worry. Whether Ulsan will be designated as a "Distributed Energy Specialized Zone (Distributed Special Zone)" is directly related to SKT’s AI data center project. On the 8th, the Ministry of Trade, Industry and Energy announced plans to introduce the Distributed Special Zone system as a measure to encourage building AI data centers in regional areas. The advantage of a Distributed Special Zone is that energy production and consumption can both occur within the designated area, making electricity rates cheaper than those supplied by Korea Electric Power Corporation. If Ulsan is designated as a Distributed Special Zone, it will open the way for SKT to procure the necessary power for its AI data center at a low cost and smoothly advance its project. If not designated, SKT will face the difficult situation of bearing a huge electricity bill. Besides Ulsan, Jeju and Busan are also known to have applied, and SKT can only anxiously wait for the results expected in the second half of this year.

This uncertainty is not limited to SKT alone. As AI continues to advance, hyperscale AI data centers requiring hundreds of megawatts of power will continue to emerge across South Korea. Moreover, it is practically difficult for all mega AI data centers to be located within Distributed Special Zones. Expecting Distributed Special Zone designation and selecting data center locations accordingly is a significant burden for companies.

Ahead of the presidential election, proposals are being made almost daily, such as "Let's create a Ministry of Science, Technology, and Artificial Intelligence" (8th, Jeong Dong-young, Democratic Party) and "Since the Ministry of Science and ICT is the main ministry for AI, it should be elevated to a deputy prime minister level in the next government" (7th, Yoo Sang-im, Minister of Science and ICT). If AI is truly important, revising the 'Special Act on the Activation of Distributed Energy' to ensure that private companies building AI data centers can receive sufficient power at affordable prices anywhere should be a priority over Distributed Special Zones. The government should not hinder companies willing to invest in AI.