South Korea plans underwater data centre as AI boom strains land and power

Ulsan is developing a seabed data centre that could house 100,000 servers, using seawater for cooling as South Korea faces mounting constraints on land, power and grid capacity

South Korea is looking beneath the sea for space to build data centres as the rapid expansion of artificial intelligence (AI) is putting pressure on land, power and cooling infrastructure, Nikkei Asia reported.

 

The city of Ulsan is developing an underwater data centre off its coast that could eventually house 100,000 servers.

 

The project, led by Ulsan and the Korea Institute of Ocean Science and Technology (KIOST), received 40 billion won ($29 million) in central government funding over five years. The broader development programme is budgeted at 51.1 billion won and aims to produce a standardised underwater data-centre model by 2030, says the report.

 

 

The proposed facility would sit about 20 metres below the sea surface, with seawater providing the primary cooling medium. Ulsan's coastal waters have an average annual temperature of about 13.3 degree Celcius, giving the project a natural source of relatively cool water for dissipating heat from high-performance servers.

 

The attraction is straightforward: cooling is one of the biggest energy burdens in a data centre. KIOST research has suggested that seawater-based cooling could substantially reduce cooling-related electricity consumption, while earlier work on the Ulsan project estimated carbon reductions of about 12 per cent.

 

The experiment comes as South Korea's AI infrastructure ambitions collide with physical constraints.

 

Data-centre power supply in the Seoul metropolitan area is expected to exceed 1,450 MW by 2028, according to CBRE Korea. But the availability of electricity is becoming the decisive factor in where new facilities can be built. Of 522 power-system impact assessment applications in the region, representing 33,592 MW of requested capacity, only 10 had received final approval by March 2026—an approval rate of just 1.9 per cent.

 

From land scarcity to 'ocean infrastructure'

 

Ulsan's plan is not to simply put conventional servers underwater. The project involves pressure-resistant enclosures, modular server and power systems and high-efficiency hybrid cooling technology.

 

The city is working with 12 industry, academic and research organisations, including KIOST, Ulsan National Institute of Science and Technology, POSCO, GS Engineering & Construction and SK Telecom. SK Telecom is responsible for developing the AI GPU infrastructure and server-operation model.

 

The commercial phase is expected to begin after the demonstration programme, with Ulsan targeting construction of a larger underwater data-centre complex from 2031. A separate Ulsan plan envisages an investment of about 500 billion won in an underwater complex capable of accommodating 100,000 servers.

 

South Korea is not alone in testing the concept. China already has an operational underwater data-centre project, while Microsoft previously tested subsea servers through its Project Natick. In May, China's HiCloud reported that a 24 MW offshore wind-powered underwater data centre was operating off Shanghai.