Masdar finds AI data centers greener than hydrogen energy

Abu Dhabi’s Masdar green energy company is shifting gears to focus on meeting the voracious power needs of AI data centers.

After budgeting billions of dollars for developing green hydrogen into a commercial fuel, Masdar has found few buyers and decided to reallocate its resources, Bloomberg reports.

For Masdar, which is owned by the ADNOC national oil company, the TAQA national energy company, and the Mubadala sovereign wealth fund, lower-than-expected revenue figures told the story, CEO Mohamed Jameel Al Ramahi says.

“Today, green hydrogen is under pressure and the market is shrinking. A lot of people who went into this venture are out. We are not,” Al Ramahi told Bloomberg. “But we also need to respect global dynamics.” 

In the renewables industry, Masdar is not alone. Many of its peers around the world have invested deeply in green hydrogen amid broad excitement over the fuel’s promise for providing clean, cheap and plentiful energy. Weak demand and high costs, however, have forced the industry to pull back.

Instead, Masdar has decided to divert the money toward an expected boom in power consumption from AI data centers, Al Ramahi said. One of the world’s biggest such projects is the $545 million facility that the UAE’s du telecom company is planning with Microsoft.

“My basic business mandate isn’t hydrogen or aluminum or whatever,” Al-Ramahi said. “It is green electron capacity.”

In another area of its business, Al-Rahimi said Tuesday that a Masdar-led consortium has secured $1.1 billion in financing from eight regional and international banks to support development of the 2-gigawatt Al Sadawi solar power plant in Saudi Arabia.