With solar energy costing just over 1 cent per kWh, Saudi Arabia aims to host the world's cheapest data centers and become a global powerhouse in artificial intelligence.

With solar energy costing just over 1 cent per kWh, Saudi Arabia is betting on ultra-cheap AI data centers to become a global artificial intelligence powerhouse.

Two hours south of Jeddah, on the shores of the Red Sea, a piece of the Saudi desert is being transformed into one of the most strategic projects on the planet. Al Shuaiba Solar Farm, which occupies approximately 50 square kilometersThis has become central to Saudi Arabia’s plans for a new type of global power: computing power. The first phase of the project, scheduled to begin in 2024, is expected to generate… 600 megawatts of electricity at just 3,9 Saudi halalas per kilowatt-hour., little more than one centFor comparison purposes, this cost represents about one-twentieth of the energy produced by the British nuclear power plant Hinkley Point C.

This extremely cheap electricity wasn’t intended solely for powering cities or traditional industries. The plan is to direct almost all of it towards… huge data centers focused on artificial intelligence, a sector where the cost of energy has become one of the world’s major economic bottlenecks.

Cheap energy has become the deciding factor in artificial intelligence.

The operation of AI systems basically depends on two ongoing costs: high performance hardware e electricity to keep it runningCutting costs on chips is often a strategic mistake, since the most modern models require more expensive and efficient processors. Therefore, The variable that really makes a difference is the cost of energy. And it is precisely at this point that Saudi Arabia has built its competitive advantage.

While other countries try to reduce operational costs through marginal efficiency gains, the Saudis are betting on something structural: To produce electricity on a colossal scale, at an almost symbolic price.…and use this advantage to reduce the cost of AI inference, the process of asking questions and getting answers from intelligent systems.

A national priority directly supported by political power.

The strategy has ceased to be merely a technological project and has become… national priority in May, with direct support from the crown prince Mohammed bin Salman (MBS)To execute the plan, the company was created. Human, commanded by Tarek Amin, current head of Aramco Digital, the technology arm of the Saudi state-owned energy company.

Humain was incorporated into Vision 2030The ambitious program seeks to reduce the country’s historical dependence on oil. According to Amin, the risk of failure is enormous, but inevitable. There is no alternative plan. The gamble needs to pay off.

Land, permits, and energy: three advantages that few countries have.

Besides cheap electricity, Saudi Arabia offers two other critical factors for global-scale data centers. The first is… physical spaceThe country is vast, sparsely populated, and allows for the rapid acquisition of building permits when there is government support. In just two weeks, Humain identified more than 200 potential locations, with access to 15,6 gigawatts of electricity, including large areas already integrated into solar projects.

The second factor is the ability to integrate energy, infrastructure, and the state. Few countries manage to align these three elements without prolonged regulatory hurdles.

Inference chips and reducing the cost per token.

The third pillar of the strategy involves the artificial intelligence chipsThe project began with an agreement between Aramco Digital and the American company. Groq, evaluated at $1,5 billion, specialized in semiconductors focused on inference, not model training.

These chips are not the preferred choice of large AI labs, which seek maximum flexibility. However, they are ideal for… reduce the cost per tokenThe basic unit charged for commercial AI services. Today, companies charge high prices for millions of tokens processed and generated. Humain’s proposal is simple: Execute models on Saudi soil, using extremely cheap energy and efficient chips, and sell tokens for about half the market price..

The opening up to advanced chips and global interest

In November, the project gained international political momentum. During a visit by MBS to the United States, a license was granted for the importation of 35 advanced Nvidia chips, valued at almost $1 billionAlthough this volume is not enough to supply all planned data centers, it represents a significant shift in the American stance, which previously restricted this type of technology to closer allies.

The movement has already attracted investors. AirTrunk, one of the world’s largest data center builders, signed a contract to US $ 3 billion partnering with Humain to develop a large infrastructure campus in the country.

Saudi Arabia also wants to be a user of its own AI.

The plan is not limited to exporting computing power. The country already uses its own systems. ALLAMThe Arabic-language AI model, developed in partnership with the Saudi Data and AI Authority (SDAIA), has begun to be used by public officials. Furthermore, Humain has signed agreements with global companies, such as… Adobe, to incorporate the model into commercial software.

This dual strategy — infrastructure and application — strengthens the ecosystem and reduces dependence on external solutions.

From data centers to an “AI operating system”

Humain’s horizon extends beyond simply hosting models. According to Tarek Amin, the long-term goal is to create… the first AI-based enterprise operating system, capable of replacing traditional human resources, finance, and legal functions with intelligent agents, featuring chatbot-based interfaces instead of clicks and icons.

It’s an ambition that many consider too bold, but it reveals the scale of the Saudi project. It’s not just about cheap energy or data centers. It’s about… to reposition the country as one of the five largest global hubs for artificial intelligence in the next five to seven years., according to analysts at PwC.

Saudi Arabia, which built its wealth on oil, is now betting that Near-free solar electricity and planet-scale computing power They can be the basis of your next historical cycle.