The Brazilian state of Rio Grande do Sul and Scala Data Centers, a leading Latin American platform of sustainable data centres in the hyperscale market, have signed a letter of intent to enable the construction of what they call the largest and most innovative digital infrastructure project in South America.
Scala AI City, as the project is called, will be established in a strategic area of Eldorado do Sul, in the metropolitan region of Porto Alegre, the capital of the state. The site was chosen for its proven safety from natural disasters (including climate events), abundant energy supply, and real estate capacity that allows for continuous expansion over decades.
This development will be interconnected with Scala's SPOAPA01 data centre in Porto Alegre, which benefits from low-latency connectivity infrastructure and a strategic position for integration with major global hubs.
Additionally, the planned connection to the Malbec submarine cable, which links São Paulo, Rio de Janeiro, and Buenos Aires and is expected to pass through the capital of Rio Grande do Sul, offers a significant competitive edge. This location ensures scalability, high resilience, and uninterrupted operations.
This ‘data centre city’ represents an initial investment of US$500 million in the first phase alone. The construction of Scala AI City will, it is claimed, generate more than 3,000 new direct and indirect jobs in the first phase.
The initial IT capacity of Scala AI City will be 54 MW, which is about seven times more than the capacity currently installed in Greater Porto Alegre and larger than markets such as Argentina and Uruguay. The expansion potential is enormous, with the possibility of reaching 4,750 MW spread across more than 1,730 acres.
The project will utilise what is described as a ‘FutureProof’ design, allowing the installation of racks that support AI training workloads, with capacities exceeding 150kW, in contrast to the 20kW or less intended for other uses. The system also plans to use liquid cooling — a refrigerant-based cooling method that offers greater energy efficiency for this type of application.
Sustainability will be a central development pillar, relying on 100% renewable and certified energy, and adopting cutting-edge technologies to minimise its environmental impact.
With the aid of the milder climate in southern Brazil, the data centres will be more efficient and achieve a power usage effectiveness (PUE) not exceeding 1.2 – the lowest in Latin America – and a water usage effectiveness (WUE) of zero, meaning no water will be used in the cooling systems – an interesting statistic given the ongoing issues other countries are facing with water use for data centres.
