Chile Seeks Data Hub Role Amid Energy, Water Challenges

Chile is striving to position itself as Latin America’s hub for data storage and transmission by developing data centres, leveraging its abundant renewable energy, and strengthening digital interconnections.

However, the plan faces significant hurdles, including the massive volumes of water required to cool servers and opposition from social and local organisations who were not consulted.

The government has launched the National Data Center Plan (PData) to provide certainty for investors and promote large-scale installations. This initiative complements the Cybersecurity Framework Law of April 2024, which set minimum standards for preventing and responding to cybersecurity incidents across state and private sectors.

PData emerged after an environmental court blocked Google’s proposed US$40 million data centre in Santiago over water usage concerns. The ruling marked a victory for local activists, who argued the project threatened scarce water resources.

Chile already hosts 38 data centres and is attracting further investment. Microsoft recently inaugurated its first Data Center Region in Santiago, pledging to invest US$3.3 billion in Chile and create over 80,000 jobs between 2025 and 2029.

Experts highlight that Chile’s renewable energy supply, extensive optical fibre network, and submarine cables give it an advantage in becoming a digital hub. But they caution that water scarcity and environmental risks must be addressed through stronger regulation, transparency, and community dialogue.

Chile now stands at a turning point: with the right policies, it could lead the region in digital infrastructure while balancing environmental sustainability.