SHANGHAI — A new wind-powered undersea data center off Shanghai is moving server racks off land and into sealed seabed capsules, aiming to cut overall power use by 22.8% while avoiding the freshwater and real estate demands of conventional facilities, Oct. 21, 2025.
The project, built in Shanghai’s Lin-gang Special Area, is designed to draw more than 95% of its electricity from offshore wind and use surrounding seawater for cooling, a pairing officials and developers say could reshape how fast-growing cloud and AI workloads are hosted in dense coastal regions. Details released through China’s government news portal and a separate Lin-gang district project brief describe a system engineered to eliminate freshwater use and reduce land occupation by more than 90% compared with traditional sites.
How the undersea data center works off Shanghai
Instead of packing servers into warehouse-sized buildings that rely on power-hungry chillers, the Shanghai undersea data center places IT equipment inside corrosion-resistant, sealed modules on the seabed. Seawater helps carry away heat, lowering the share of electricity typically consumed by cooling. Coverage of the buildout has pointed to a target power usage effectiveness around 1.15, a metric that measures how much energy is spent beyond computing itself, with more efficient sites closer to 1.0. Wired’s reporting and a technical rundown by Tom’s Hardware put the first phase at commercial scale, with capacity expected to expand as additional modules are deployed.
For Shanghai, the pitch is as much about geography as kilowatts. A coastal megacity with limited industrial land, it faces the same data-growth pressure as other hubs, but with fewer easy places to build new, energy-intensive campuses. By pushing hardware offshore, the undersea data center model tries to keep computing close to users while easing siting constraints.
Continuity over time: a concept years in the making
The Shanghai build is also a fresh chapter in an idea that has circulated for nearly a decade. Microsoft tested the concept with Project Natick, including a deployment off Scotland that ran for two years; the company later said submerged servers saw fewer failures in the stable, low-oxygen environment. Microsoft summarized those results in a 2020 Project Natick update.
Long before Shanghai’s wind-linked system, the broader notion was already drawing attention as a cooling solution. Fortune wrote in 2016 about early Microsoft trials, and Axios noted in 2018 how offshore data centers could pair naturally with marine renewables.
What comes next for the undersea data center model
China has been experimenting with submerged computing beyond Shanghai, and the stakes are rising as AI accelerates demand for power-dense infrastructure. Scientific American reported in 2025 that China has pursued pilots off Hainan and is pushing forward with more advanced builds, with Shanghai now positioning itself as a headline case.
Still, scaling an undersea data center raises hard questions: How quickly can operators repair or replace failed components? How will regulators and researchers track local marine impacts over years, not months? And can offshore wind supply remain stable enough to keep critical computing online without heavier grid backup?
For now, Shanghai’s wind-powered undersea data center is being framed as a practical efficiency play — a bid to cool servers with the sea, power them with offshore wind, and cut energy use without adding another sprawling land campus to an already crowded coastline.
