AI Factory and Data Center in Central Alabama Raises Questions

Proposed facility would consume massive amounts of power and water, sparking environmental concerns

Published on Feb. 25, 2026

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A planned AI factory and data center in central Alabama is generating a lot of questions and concerns from local residents and environmental groups. The facility, which would be built on a 75-acre site in Birmingham, is expected to use 300MW of power - enough to power tens of thousands of homes. While the company says this will not impact Alabama Power customers' rates, critics argue the power draw and water consumption of such a large facility could have significant environmental consequences.

Why it matters

Data centers and AI factories are becoming more common across the country, but their massive energy and water demands are raising concerns about the impact on local communities and the environment. This proposed facility in Birmingham highlights the tensions between economic development and environmental protection that often arise with these types of large-scale tech projects.

The details

The AI company has already purchased a 75-acre parcel in Birmingham to build the new facility, which would involve tearing down an existing building. The company says the factory will generate tens of millions in annual tax revenue and create hundreds of construction jobs. However, the Southern Environmental Law Center is worried about the facility's power and water consumption, arguing that communities shouldn't have to choose between economic growth and environmental protection. The company says it wants to partner with Birmingham to address any concerns, but critics argue that simply building a new power substation does not solve the underlying issues around the facility's energy demands.

  • The Birmingham Zoning Board of Adjustment will discuss the power substation issue at a meeting on February 26, 2026 at 3:00 PM.

The players

AI Company

The technology company planning to build the AI factory and data center in Birmingham.

Ryan Anderson

An attorney at the Southern Environmental Law Center who is concerned about the power and water demands of the proposed facility.

Alabama Power

The utility company that will be providing power to the AI factory and data center.

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What they’re saying

“These AI factories and data centers demand a lot of power and water. Communities shouldn't have to choose between clean air and clean water, and having a robust education system and a thriving economy. So if that's the choice that people are being asked to make, I think it's an unfair one.”

— Ryan Anderson, Attorney, Southern Environmental Law Center

“There will be tens of millions of dollars annually in tax revenue associated with this facility. There will be hundreds of construction jobs associated with this facility. It's about $88 million is what the city and the county schools will receive off this project.”

— AI Company Representative

What’s next

The Birmingham Zoning Board of Adjustment will discuss the power substation issue related to the proposed AI factory at a meeting on February 26, 2026 at 3:00 PM.

The takeaway

This proposed AI factory highlights the growing tensions between the tech industry's need for massive amounts of power and water, and the environmental concerns of local communities. As data centers and AI facilities become more common, policymakers will need to find ways to balance economic development with protecting natural resources and the environment.