Wonder Valley Watch: It's marked out just like a large chessboard
Update #2: Elon Musk's AI data centre fiasco in Memphis shows how it's done.
My Scottish/Irish ancestors were immigrants who travelled by ship to the east coast of so-called “Canada” in the late 1700’s or early 1800’s and were part of several waves of genocidal colonization of the Indigenous people on Turtle Island. We arrived uninvited on the traditional unceded territory of the Wəlastəkewiyik (Maliseet) whose ancestors along with the Mi’Kmaq / Mi’kmaw and Passamaquoddy / Peskotomuhkati Tribes / Nations signed Peace and Friendship Treaties with the British Crown in the 1700s. As a child in the 1970’s, my parents moved west to work in the oil sands industry and I grew up in the Nistawâyâw (Cree) Ełídlį Kuę́ (Dene) - Fort McMurray area within Treaty 8 territory, which his home to six First Nations and six Métis communities. Today, I am grateful to be writing this newsletter from Moh’kinsstis, and the traditional Treaty 7 territory of the Blackfoot confederacy: Siksika, Kainai, Piikani, as well as the Îyâxe Nakoda and Tsuut’ina nations. This territory is also home to the Métis Nation of Alberta, Region 3 within the historical Northwest Métis homeland. I recognize that the land I now work and live on was stolen from these Nations (truth) and I support giving the land back as an act of reconciliation. Lands inhabited by Indigenous Peoples contain 80% of the world’s remaining biodiversity. Indigenous Peoples’ traditional knowledge and knowledge systems are key to designing a sustainable future for all. We are all Treaty people on Native land. My Canada Day involves reflecting on reconciliation and how I can help move it forward.
“I declare it’s marked out just like a large chessboard!” Alice said at last. “There ought to be some men moving about somewhere—and so there are!” She added in a tone of delight, and her heart began to beat quick with excitement as she went on. “It’s a great huge game of chess that’s being played—all over the world—if this is the world at all, you know. Oh, what fun it is! How I wish I was one of them! I wouldn’t mind being a Pawn, if only I might join—though of course I should like to be a Queen, best.”
Through the Looking Glass by Lewis Carroll
(Ed. note: I can’t help but mention that Alberta now has a "No Queens Day” rally planned for July 17 for some premiers who “should like to be a Queen.”)
This is Update #2 in a series, see Update #1 here.
Recap: Premier Danielle Smith’s Artificial Intelligence (AI) Data Centre strategy has been touted as “innovative” and an example of “economic diversification,” but in reality, it’s the opposite.
Despite what Nate Glubish, Alberta’s minister of technology and innovation says, evidence continues to mount that it’s providing cover for the government’s plan to double oil and gas production.
Top of the long list of AI data centres planned or already underway in Alberta is the proposed “Wonder Valley” AI data centre that celebrity investor Kevin O’Leary has announced, and talked about endlessly on Fox Business shows. It’s very likely envisioned to be a hyperscaled data centre, powered entirely by gas turbines, to be built in northern Alberta at a cost of C$70 billion.
And he’s enlisted a US real estate mogul, Frank McCourt to help him fund the purchase of the land for this monstrosity, which would ultimately require 7.5 gigawatts to run, in the hopes of quick approvals based on promises he says were made to him directly by Smith. He’s still out looking for more investors.
Setting the stage
In related news this month, Alberta’s Electric System Operator (AESO) introduced limits on how many data centres it will allow to connect to the electrical grid.
AESO is an independent operator of Alberta’s grid but its previous president and CEO, Michael Law resigned last year after 15 years at the helm over his opposition to the UCP government’s renewable energy moratorium.
Government-appointed AESO board chair, Karl Johannson, told Law to “support the minister without reservation.” When he wouldn’t agree, he was gone, and has since become an outspoken critic of the government.
Now, Law’s replacement, Aaron Engen has announced “Alberta cannot possibly connect all those proposed data centre projects in the short term.”
As has already been pointed out by the Globe and Mail’s deep dive into this, Smith’s “zany” plan for attracting AI data centres doesn’t appear to take into consideration the current infrastructure limitations.
Perhaps that’s because Smith knows that if a giant AI data centre uses fossil gas (of which Alberta has plenty) it can skip the AESO “Hunger Games” altogether. And how nicely this fits into her plans to double oil and gas production. AI data centres deliver an immediate customer for the province’s fossil gas, climate-warming emissions be-damned.
There are currently 29 proposed projects needing a total of 16 gigawatts (not including Wonder Valley). That’s more than the power demand of 10 cities the size of Edmonton. AESO has made a short list of 15 projects and that will be further reduced this month.
“The bring-your-own-generation concept makes perfect sense, and that data centres setting up their own power generation could be a sensible way to develop more projects.”
AESO CEO Aaron Engen
As Alice discovered in that weird mirror, everything is reversed, including logic, in a reflection of Alberta’s inability to see beyond fossil fuels.
Cheers to you, Wonder Valley
A recent op-ed in the Calgary Herald from three Wonder Valley enthusiasts caught my eye. It’s a full-throated marketing pitch by a former oil and gas executive (who it turns out is a big fan of Quick Dick McDick’s YouTube Channel, which rages about the “extreme climate cult”), a professional geoscientist and business development advisor for “energy information services” who did a report on Wonder Valley (no declared conflict of interest), and a former biomedical/electrical engineer for NASA who is also currently a physician for Alberta Health Services (according to his LinkedIn profile).
“When we first heard reference to a 7.5 GW data center, we (the three authors) looked at each other quizzically and asked, what does that mean? We've been trying to figure that out ever since!”
Micheal B. Woofter on LinkedIn
Their over-the-top promotion of the project is...quite something. According to the three authors, the “mega energy project” will include 14 gigawatts of total power capacity, 48 billion gallons of cooling water per year, and 720 billion cubic feet of natural gas production annually — “all eventually mitigated with a closed-loop, carbon-capture ecosystem, developed with Alberta ingenuity.”
(Ed. note: “Eventually” being the key word here. See below)
“Data centres are Alberta’s next best destiny, but a pilot project to prove the totality of this vision should commence immediately. Alberta must act now or risk watching this once-in-a-generation opportunity go elsewhere,” wrote the breathless authors.
Of course, the looming question seems to be, what action are they looking for from Alberta? The province has done nothing but give Wonder Valley its unwavering support, but so far, the government has insisted it will receive NO PUBLIC MONEY (remember this promise).
O’Leary and McCourt have yet to purchase the land, as far as we know, which is the next step. So what are they looking to achieve with this op-ed?
As with many of these Postmedia opinion pieces, the timing usually coincides with something the UCP government is planning or announcing. The ringing endorsement of the enormous data centre/gas plant came just ahead of the Canadian Council of Ministers of the Environment meetings in Yellowknife, Northwest Territories from July 2 to 4, 2025.
Alberta and Ontario’s environment ministers have penned (pdf) a letter to the federal minister of environment and climate change reiterating Alberta’s list of demands to the prime minister including the following:
repeal the Impact Assessment Act and the Physical Activities Regulations, too;
repeal the Clean Electricity Regulations;
repeal the Greenhouse Gas Pollution Pricing Act;
amend the Species at Risk Act to “respect” provincial jurisdiction;
suspend the proposed oil and gas emissions cap; and
refrain from reintroducing Bill C-61, which relates to water and related infrastructure on First Nations lands.
“We are hopeful that this new federal government will move away from policies and legislation that undermine competitiveness, delay project development, and disproportionately harm specific provinces and territories without any quantifiable benefits to the natural environment.”
Rebecca Schulz and Todd J. McCarthy
It could be that some (or all) of these demanded changes would impact the Wonder Valley data centre, specifically the emissions cap, the Impact Assessment Act, and Bill C-61, legislation endorsed by the Assembly of First Nations, to set drinking water standards on reserves. The bill did not make it through the previous government’s legislative agenda before Justin Trudeau resigned and parliament was prorogued.
AI data centres need an awful lot of water. One First Nation, the one closest to the Wonder Valley site, has asked the government to “cease and desist” until they have been consulted and give their consent for the project.
Money, not for nothing
Another threesome authored an op-end in the Calgary Herald earlier this month, shrugging off the AESO limits on data centres, calling the trend to self-powered sites, “a market signal hiding in plain sight.”
The three co-founders of a venture capital firm said Alberta should “streamline approvals for gas plants under 100 MW, waive industrial emitter payments when units serve isolated software computation, offer royalty credits for flare or shut-in gas diverted to AI workloads, and extend ‘SuperNet 2.0’ fibre throughout every gas basin, so that bits, not molecules, travel long distances.”
Of course, they argue that Alberta should seize the moment, since the impetus for AI data centre operators is to recover the high cost AI chips now, rather than wait decades to connect to the grid.
They also called for the Alberta Treasury Branch (ATB) a corporation owned by the Alberta government, to set up a “world-first lending program that treats industrial chips and watt-bit infrastructure as a new secured asset class, the same way it once pioneered project finance for Alberta’s oilsands.”
Ed. note: Interestingly, the company boasted on LinkedIn of a working session recently held in Calgary and tagged Michael Law, former CEO of AESO.
We can see what’s happening here, I think. It’s a call out for some public funding in the form of royalty credits, the waiving of emitter payments, and investment in more “fibre” infrastructure. There’s also a suggestion of government loans, similar to the oilsands.
Case study: Let’s look at another gas-powered, hyperscaled AI data centre
AI data centres pushed by US billionaires are on the rise everywhere. The Elon Musk playbook shows how they’ll get their way.
Local businesses, utility companies and eager politicians are approached quietly, some even signing non-disclosure agreements. Deals are made behind-the-scenes without involving the local community, especially the ones who are going to try to hold them to account for environmental impacts.
Sound familiar?
Then, everything gets built so quickly that once people find out, it’s already up and operating. Here’s an excerpt from my latest article about how it’s all playing out in Memphis Tennessee, with a link to the full article at the end.
Musk’s AI Project Faces Environmental Racism Suit in Historic Black Memphis Community
The NAACP intends to sue Elon Musk’s xAI company and others involved in building a gas-spewing artificial intelligence (AI) data centre on the edge of Memphis.
And Musk’s own AI chatbot appears to agree.
Partnering with the Southern Environmental Law Center (SELC), the National Association for the Advancement of Colored People (NAACP) issued the required 60-day notice June 17, alleging Clean Air Act violations after xAI hastily built what it claims is the “world’s biggest supercomputer” just a few kilometres from Boxtown—a South Memphis community founded in the 1860s by African Americans escaping enslavement.
The first of xAI’s two planned data centres is powered by gas turbines, but without the required permits and pollution controls, says the NAACP. The civil rights organization is also disputing the number of turbines onsite. It obtained aerial and satellite images that appear to show 35 turbines, while local officials say there are 15 to 17.
A video shot by methane watchdog group Oilfield Witness using an optical gas imaging camera also showed “huge, billowing plumes of pollution, including large volumes of unburned methane, ris[ing] into the atmosphere and drift[ing] off-site,” reports Gas Outlook.
“We cannot afford to normalize this kind of environmental injustice—where billion-dollar companies set up polluting operations in Black neighbourhoods without any permits and think they’ll get away with it because the people don’t have the power to fight back,” NAACP President and CEO Derrick Johnson said in a release.
Read the full story for free at The Energy Mix!
“We deserve clean air, not silent strangulation”
One of the aspects of the story that I wasn’t able to get into great detail about was the health effects on the local community. South Memphis already has high levels of ground-level ozone, and now they expect the gas turbines powering the data centers will increase ozone pollution.
Breathing ground-level ozone can lead to respiratory symptoms (cought, throat irritation, burning in the chest, and shortness of breath), decreased lung function and inflammation of the airways. Read more at the Environmental Protection Agency’s website.
Data Center Dynamics carried an article back in 2024 just after the the Tennessee Valley Authority (TVA) gave xAI the green light to proceed. It would appear from the article that they gave little consideration to the health impacts, and were focused on bringing investment and jobs to the community.
KeShaun Pearson, president of Memphis Community Against Pollution, said: “The ongoing policy violence that allows xAI to continue the consistent damaging of our lungs in Southwest Memphis is immoral, we deserve clean air, not silent strangulation.”
“We are alarmed that the TVA Board rubberstamped xAI’s request for power without studying the impact it will have on local communities,” Amanda Garcia, senior attorney at the Southern Environmental Law Center said.
The agreements to power the data center are complicated, with xAI moving to both bring in turbines and also construct a new power station (which will then be handed off to the local utility company). They have applied for eight megawatts of power from the grid to help meet xAI’s enormous electricity requirements.
Disinformation by design
Ahead of a contentious public hearing in South Memphis, The Guardian revealed that an anonymous group called “Facts Over Fiction” had distributed fliers throughout the local community claiming the turbines are “specially designed to protect the air we all breathe.”
(Ed. note: Stay tuned for more details coming soon on a Canadian connection to this story.)
Justin Pearson, a Tennessee state representative from the area said the fliers were “lying to us,” and he wanted to know who had mailed them out to local mailboxes. No word yet on who was responsible.
For a dramatic retelling of the xAI data center story, the More Perfect Union Foundation, a non-profit education, advocacy and journalism foundation has a 17-minute video entitled, “We Went to the Town Elon Musk is Poisoning.” Well worth watching it in full.
Sharon Wilson, a “methane hunter” for Oilfield Witness posted on LinkedIn about her role in the story, which included turning her optimal gas imaging camera on the xAI data center’s turbines to detect the heat and methane emissions coming from the turbines.
“This intense pollution did not start in Memphis. It started where they drill the hole in the ground and it continues through every stage required to get the methane gas to Elon Musk’s site in Memphis,” she wrote, adding "Clean natural gas is a scam.”
More AI news:
'A Black Hole of Energy Use': Meta's Massive AI Data Center Is Stressing Out a Louisiana Community
404 Media, June 23, 2025 - A rural community is home to a four million square foot AI data center. Meta wants to keep the details under wraps, but some of the infrastructure will be partially paid by Louisiana residents.
Data Centers Are Building Their Own Gas Power Plants in Texas
Inside Climate News, June 5, 2025 - Large hyperscalers are turning a blind eye to their environmental goals and communities, with 42 new gas turbine projects under construction in Texas.
Also, listen to this two-parter on Short Wave about some solutions for energy and water intensive, polluting mega-sized data centres. This is part two (link to part one is in the episode notes). It’s not too long and explains some of the issues well.
And for the final word:
Why Does Every Commercial for A.I. Think you’re a Moron? (gift link)
An article in The New York Times Magazine (June 25, 2025) suggests AI companies don’t have a clue how their product can actually help people and their take (at least in their commercials) is truly bizarre.
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The Wonder Valley Watch: Follow me down the rabbit hole
Someone has to keep an eye on this, and since I’ve been doing it anyway, I’ve added a regular Wonder Valley “watch” to my newsletter. So, follow me down the rabbit hole as I update you on some of the characters involved — Mr. Wonderful himself, Abu Dhabi data centre guy Carl Agren, and Kyle Reiling, the GIG’s executive director and the project’s second most prolific promoter.
Questions for readers:
Is Wonder Valley actually located in a valley? Can anyone located near that area report back to me? Thanks.
Kevin O’Leary just became the “brand ambassador” for a company called “One Development” and there’s an AI connection. Not sure what it all means but speculation welcomed in the comments.