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- Fermi CEO says Europe is embracing renewables at the worst possible time
Britain and Europe's 'obsession' with green energy means they risk losing out on a boom in demand for data centres to fuel the AI revolution, a US executive has warned.
Toby Neugebauer, the boss of Texas-based Fermi, which made its debut on the London Stock Exchange and New York's Nasdaq last week in a multi-billion pound listing, said the high cost of electricity across the continent meant it would not be possible to build the amount of data centres needed to fuel the demands of AI as its use expanded.
'Europe and the UK's obsession with renewables couldn't have happened at a worse time,' Neugebauer told The Mail on Sunday. He said Fermi's 5,236-acre data centre site in Texas, known as Project Matador, had access to wind and solar power, but was also able to take advantage of a recent expansion in oil and gas production, making electricity more affordable.
'Our site is near lots of wind and solar power. But this part of Texas has also added 13 million barrels of oil production a day and 75 trillion cubic feet of natural gas reserves,' he said.
'America did all of it, that's why our power prices here are going to be a third to a quarter of what they are in Europe. And that's a tragedy because they are not going to be able to build AI capacity at scale as you do not have power at a price that is reasonable.'
The data centre boss also said winding down oil and gas production in the North Sea, a policy championed by Energy Secretary Ed Miliband, would be a 'travesty' for Britain, adding: 'I love the UK too much to wish that upon them.' His comments are likely to inflame tensions in the Labour Cabinet over whether to prioritise green energy or economic growth.
Last week, Chancellor Rachel Reeves appeared to slap down Miliband's Net Zero ambition, saying she was not a 'zealot of green energy' and pledged to support 'homegrown' supplies from North Sea oil and gas developments.
Miliband remained undeterred, announcing at Labour's annual party conference on Wednesday that the Government was drawing up plans to permanently ban shale gas extraction, or fracking.
Britain's electricity prices are already the highest in the developed world, and Neugebauer's warning comes as more firms look to cash in on the AI revolution.
This interest helped propel Fermi's stock higher in its first days of trading. Shares in the firm, co-founded by ex-US energy secretary Rick Perry, are changing hands at $30.10, 43 per cent higher than its listing price of $21, valuing it at $17.8 billion (£13.2 billion).
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