AI Infrastructure Intelligence for Alabama

## Alabama Current Intelligence Brief Alabama is emerging as a significant location for data center investments, driven by a favorable business climate, strategic location, and developing infrastructure. The state is experiencing substantial growth in its technology sector, with a particular focus on AI and data-intensive operations. ### 1. AI Data Center Activity Alabama currently hosts 41 data center facilities operated by 20 providers. The largest operational data center is Google Bridgeport with 50 MW. Meta operates 11 sites, and DC Blox has 15 locations. The state has 13 operating data centers with a combined capacity of 764 MW, and 14 planned projects that are projected to add 2,704 MW of capacity. **Known Projects and Operators:** * **Meta Platforms:** Investing a total of $1.5 billion in its Montgomery data center, building on previous investments in Huntsville. The Montgomery campus is planned to reach nearly 1.3 million square feet and the Huntsville site represents a $1.5 billion+ investment. Meta operates hyperscale campuses in Huntsville and Montgomery, supported by renewable energy projects totaling 227 MW. * **Google:** Operates a $600 million data center in North Alabama. Google is investing $1.5 billion to expand its data center campus in Jackson County, which opened in 2019. The Google Jackson County data center has two buildings spanning 135,000 square feet as of 2022. * **DC Blox:** Has made data center investments in Alabama. DC Blox is expanding its Birmingham facility to 263,000 square feet and 54 MW of critical load. The DC Blox Birmingham data center is a Tier 3 facility. * **AUBix:** A secure and compliant multi-tenant data center in Auburn, which is Alabama's first NVIDIA-certified, AI-enabled data center. Core Scientific is expanding into Auburn, investing $135 million to establish its operation in the existing AUBix data center, with an expected total investment of $400 million and expanding capacity to 16 MW. * **Nebius AI Factory (Birmingham):** A proposed AI data center in the Oxmoor Valley area with a target capacity of up to 300 MW. The facility is designed for liquid-cooled, high-density GPU architecture. * **Project Marvel (Bessemer):** A large-scale AI data center that has expanded to include roughly 1,600 acres for 18 server farms. This project has an announced investment of $14.5 billion and a planned power capacity of 1.2 GW. Local opposition has been significant due to concerns about energy and water consumption. * **Project Red Clay (Lowndes County):** An 800-plus-acre site near Highway 80 and Alabama Highway 21, being developed by Cloverleaf Infrastructure, with a planned capacity of 1,500 MW. * **Western Hospitality Childersburg Data Center (Childersburg):** A planned 500 MW capacity data center. * **Digihost (Shelby County):** A planned 55 MW, two-phase project. ### 2. Power and Grid Infrastructure Alabama's power grid infrastructure is primarily managed by Southern Company, with a contribution from the Tennessee Valley Authority (TVA). Alabama Power, a subsidiary of Southern Company, serves customers with 11,678 MW of generating capacity. The state's commercial electricity rate averaged 14.68 ¢/kWh in October 2025. Nuclear and hydro resources contribute to a steady baseload power supply. TVA's Browns Ferry plant provides nearly 3,700 MW of nuclear capacity, and hydroelectric dams supply about 6% of the state's electricity. **Interconnection Queue:** Alabama's interconnection queue is largely shaped by Southern Company's vertically integrated planning, with utility-led projects dominating. The queue includes nearly 10 GW of renewables, with solar leading at 5.1 GW and hybrid projects adding 3.5 GW. Standalone battery storage contributes 1.25 GW. Gas projects account for 8.2 GW in the queue. As of January 2026, Alabama had 48 active generation interconnection requests totaling 8.67 GW, primarily solar and storage projects. There are 555 total projects in Alabama's interconnection queue, with 91 active, 27 operational, and 437 withdrawn. **Utility Landscape:** * **Alabama Power:** The primary investor-owned utility, regulated by the Alabama Public Service Commission (PSC). Alabama Power requires data centers to cover the full cost of their energy needs to protect existing customers. * **Tennessee Valley Authority (TVA):** Supplies power in parts of Alabama, particularly to Google's facilities. Google has contracted to bring 300 MW of new power capacity to the Tennessee Valley region and has partnered with TVA to supply up to 50 MW of advanced nuclear power to data centers. ### 3. Permitting and Regulatory Environment The permitting and regulatory environment for data centers in Alabama is evolving, with some municipalities implementing stricter controls due to public concerns. * **Birmingham Ordinance:** The Birmingham City Council adopted a zoning ordinance in June 2026 that establishes 20 requirements for hyperscale data center projects. These requirements include a minimum five-acre site, a 500-foot setback from residential areas, closed-loop cooling systems to limit water consumption, noise studies, and restrictions on certain types of on-site power generation. The ordinance also requires certified mail notification to property owners within 500 feet of proposed developments. Any material expansion of existing facilities will trigger a new review. * **Moratoriums:** Several cities in Central Alabama, including Homewood, Springville, Leeds, and Calera, have adopted data center moratoriums to review zoning laws and determine appropriate regulations. Birmingham approved a six-month moratorium in March 2026. * **State-level Legislation:** The Alabama Legislature has taken action to address data centers, including a bill to reduce tax abatements for large centers and another requiring facilities to pay for their energy consumption. Federal legislation, the Advancing Water Reuse Act, introduced by Senator Katie Britt (R-AL), aims to provide a 30% tax credit for data centers investing in water recycling projects. * **Tax Incentives:** Alabama offers significant tax incentives for data centers. The Alabama Data Processing Center Economic Incentive Enhancement Act provides sales, use, and property tax abatements. Qualifying projects can receive property and sales/use tax abatements for up to 30 years, depending on capital investment and job creation. To qualify, projects typically need a capital investment of at least $200 million (or $400 million for extended abatements) and the creation of a certain number of new jobs with specified average compensation. ### 4. Semiconductor and Supply Chain Presence Alabama contributes to the national semiconductor manufacturing landscape, with approximately 4,200 manufacturing establishments. The state has seen a 31.7% average annual growth in the Semiconductor & Circuit Manufacturing industry from 2021 to 2026. * **Manufacturing and Design:** Companies in Alabama are involved in fabricating integrated circuits, assembling and testing chips, and producing semiconductor manufacturing equipment. Key cities for semiconductor manufacturing include Birmingham, Huntsville, Mobile, Montgomery, and Tuscaloosa. * **Integrated Device Manufacturers:** Companies like Intel and Texas Instruments design and fabricate their own chips. * **Pure-Play Foundries:** Contract chip fabricators like TSMC and GlobalFoundries manufacture chips designed by fabless companies. [cite## Alabama Current Intelligence Brief Alabama is emerging as a significant location for data center investments, driven by a favorable business climate, strategic location, and developing infrastructure. The state is experiencing substantial growth in its technology sector, with a particular focus on AI and data-intensive operations. ### 1. AI Data Center Activity Alabama currently hosts 41 data center facilities operated by 20 providers. The largest operational data center is Google Bridgeport with 50 MW. Meta operates 11 sites, and DC Blox has 15 locations. [cite: 7, 8] The state has 13 operating data centers with a combined capacity of 764 MW, and 14 planned projects that are projected to add 2,704 MW of capacity. [cite: 19] **Known Projects and Operators:** * **Meta Platforms:** Investing a total of $1.5 billion in its Montgomery data center, building on previous investments in Huntsville. The Montgomery campus is planned to reach nearly 1.3 million square feet and the Huntsville site represents a $1.5 billion+ investment. [cite: 5, 25] Meta operates hyperscale campuses in Huntsville and Montgomery, supported by renewable energy projects totaling 227 MW. [cite: 25] * **Google:** Operates a $600 million data center in North Alabama. [cite: 5] Google is investing $1.5 billion to expand its data center campus in Jackson County, which opened in 2019. [cite: 30, 41] The Google Jackson County data center has two buildings spanning 135,000 square feet as of 2022. [cite: 30] * **DC Blox:** Has made data center investments in Alabama. [cite: 5] DC Blox is expanding its Birmingham facility to 263,000 square feet and 54 MW of critical load. [cite: 25] The DC Blox Birmingham data center is a Tier 3 facility. [cite: 22] * **AUBix:** A secure and compliant multi-tenant data center in Auburn, which is Alabama's first NVIDIA-certified, AI-enabled data center. [cite: 15] Core Scientific is expanding into Auburn, investing $135 million to establish its operation in the existing AUBix data center, with an expected total investment of $400 million and expanding capacity to 16 MW. [cite: 15, 25] * **Nebius AI Factory (Birmingham):** A proposed AI data center in the Oxmoor Valley area with a target capacity of up to 300 MW. [cite: 4, 11] The facility is designed for liquid-cooled, high-density GPU architecture. [cite: 11] * **Project Marvel (Bessemer):** A large-scale AI data center that has expanded to include roughly 1,600 acres for 18 server farms. [cite: 4] This project has an announced investment of $14.5 billion and a planned power capacity of 1.2 GW. [cite: 20] Local opposition has been significant due to concerns about energy and water consumption. [cite: 26] * **Project Red Clay (Lowndes County):** An 800-plus-acre site near Highway 80 and Alabama Highway 21, being developed by Cloverleaf Infrastructure, with a planned capacity of 1,500 MW. [cite: 4, 19] * **Western Hospitality Childersburg Data Center (Childersburg):** A planned 500 MW capacity data center. [cite: 4, 19] * **Digihost (Shelby County):** A planned 55 MW, two-phase project. [cite: 4] ### 2. Power and Grid Infrastructure Alabama's power grid infrastructure is primarily managed by Southern Company, with a contribution from the Tennessee Valley Authority (TVA). [cite: 13] Alabama Power, a subsidiary of Southern Company, serves customers with 11,678 MW of generating capacity. [cite: 31] The state's commercial electricity rate averaged 14.68 ¢/kWh in October 2025. [cite: 25] Nuclear and hydro resources contribute to a steady baseload power supply. [cite: 25] TVA's Browns Ferry plant provides nearly 3,700 MW of nuclear capacity, and hydroelectric dams supply about 6% of the state's electricity. [cite: 25] **Interconnection Queue:** Alabama's interconnection queue is largely shaped by Southern Company's vertically integrated planning, with utility-led projects dominating. [cite: 13] The queue includes nearly 10 GW of renewables, with solar leading at 5.1 GW and hybrid projects adding 3.5 GW. [cite: 13] Standalone battery storage contributes 1.25 GW. [cite: 13] Gas projects account for 8.2 GW in the queue. [cite: 13] As of January 2026, Alabama had 48 active generation interconnection requests totaling 8.67 GW, primarily solar and storage projects. [cite: 14] There are 555 total projects in Alabama's interconnection queue, with 91 active, 27 operational, and 437 withdrawn. [cite: 24] **Utility Landscape:** * **Alabama Power:** The primary investor-owned utility, regulated by the Alabama Public Service Commission (PSC). [cite: 11, 25] Alabama Power requires data centers to cover the full cost of their energy needs to protect existing customers. [cite: 23] * **Tennessee Valley Authority (TVA):** Supplies power in parts of Alabama, particularly to Google's facilities. [cite: 14] Google has contracted to bring 300 MW of new power capacity to the Tennessee Valley region and has partnered with TVA to supply up to 50 MW of advanced nuclear power to data centers. [cite: 30] ### 3. Permitting and Regulatory Environment The permitting and regulatory environment for data centers in Alabama is evolving, with some municipalities implementing stricter controls due to public concerns. * **Birmingham Ordinance:** The Birmingham City Council adopted a zoning ordinance in June 2026 that establishes 20 requirements for hyperscale data center projects. [cite: 16] These requirements include a minimum five-acre site, a 500-foot setback from residential areas, closed-loop cooling systems to limit water consumption, noise studies, and restrictions on certain types of on-site power generation. [cite: 16, 23] The ordinance also requires certified mail notification to property owners within 500 feet of proposed developments. [cite: 16] Any material expansion of existing facilities will trigger a new review. [cite: 16] * **Moratoriums:** Several cities in Central Alabama, including Homewood, Springville, Leeds, and Calera, have adopted data center moratoriums to review zoning laws and determine appropriate regulations. [cite: 33] Birmingham approved a six-month moratorium in March 2026. [cite: 33] * **State-level Legislation:** The Alabama Legislature has taken action to address data centers, including a bill to reduce tax abatements for large centers and another requiring facilities to pay for their energy consumption. [cite: 21] Federal legislation, the Advancing Water Reuse Act, introduced by Senator Katie Britt (R-AL), aims to provide a 30% tax credit for data centers investing in water recycling projects. [cite: 21] * **Tax Incentives:** Alabama offers significant tax incentives for data centers. The Alabama Data Processing Center Economic Incentive Enhancement Act provides sales, use, and property tax abatements. [cite: 6] Qualifying projects can receive property and sales/use tax abatements for up to 30 years, depending on capital investment and job creation. [cite: 9, 10, 18, 25] To qualify, projects typically need a capital investment of at least $200 million (or $400 million for extended abatements) and the creation of a certain number of new jobs with specified average compensation. [cite: 6, 10, 18, 25] ### 4. Semiconductor and Supply Chain Presence Alabama contributes to the national semiconductor manufacturing landscape, with approximately 4,200 manufacturing establishments. [cite: 3] The state has seen a 31.7% average annual growth in the Semiconductor & Circuit Manufacturing industry from 2021 to 2026. [cite: 17] * **Manufacturing and Design:** Companies in Alabama are involved in fabricating integrated circuits, assembling and testing chips, and producing semiconductor manufacturing equipment. [cite: 3] Key cities for semiconductor manufacturing include Birmingham, Huntsville, Mobile, Montgomery, and Tuscaloosa. [cite: 3] * **Integrated Device Manufacturers:** Companies like Intel and Texas Instruments design and fabricate their own chips. [cite: 3] * **Pure-Play Foundries:** Contract chip fabricators like TSMC and GlobalFoundries manufacture chips designed by fabless companies. [cite