Microsoft plans to expand its data center capacity to over 38 gigawatts by 2032, tripling its current footprint of approximately 12 gigawatts. This projected energy demand exceeds the peak electricity consumption of New York state.
AI-specific capacity is currently around 2 gigawatts and is expected to reach 12 to 13 gigawatts by 2032, representing about one-third of the total capacity. The company has previously declined business due to power and computing constraints.
Capital expenditures reached $145 billion in the last fiscal year, with projections of $175 billion for the 2026 calendar year. Spending for the first fiscal quarter of 2027 is estimated at $50 billion.
The corporation is extending long-term data center lease terms from 15 to 25 years. Meanwhile, carbon emissions linked to data center electricity usage rose by 25% year-over-year, challenging the company's 2020 pledge to be carbon negative by 2030.
Local communities are increasingly opposing new data center projects, citing concerns over water consumption, noise, and power grid strain. Northern Virginia is frequently cited as an example of the impact of rapid data center development.
