The Gulf's AI buildout is now a power problem

Stargate UAE is a one-gigawatt compute cluster within a planned five-gigawatt campus at Masdar City. Saudi Arabia's utilities signed three agreements during LEAP 2026 specifically to supply power to AI data centre projects, including one between National Grid SA and HUMAIN for the Riyadh AI data centre development. The pattern across both countries is the same, and it marks a shift in what limits AI capacity. Through 2023 and 2024 the binding constraint on AI infrastructure was accelerators. Nvidia's supply, export controls and allocation decided who could build what. That eased. What replaced it is power, and power does not respond to capital on the same timescale. A gigawatt is roughly the output of a substantial power station. Delivering it to a single site requires generation capacity, high-voltage transmission, substations, transformers with multi-year lead times, and grid operators willing to commit firm capacity to a customer whose load profile is unlike anything they have supplied before. None of that can be accelerated by paying more, because the constraint is manufacturing capacity for heavy electrical equipment and the physical work of building transmission. It is the same constraint every market building AI capacity is now working against. The first consequence is that the electrical supply chain becomes strategically interesting. alfanar's commitment to localise data centre component manufacturing in Saudi Arabia is a bet on exactly this, and the utilities' project arms are moving into data centre infrastructure from the power side. The second is cooling. High-density GPU racks cannot be air-cooled economically, which is why ACES has signed partnerships with Submer on immersion cooling and Hypertec on high-density infrastructure. Cooling has moved from a facilities line item to a design constraint that determines how much compute fits on a site. The third is phasing. Stargate UAE's first 200MW is expected online in 2026; the remaining 800MW of the cluster and the further four gigawatts of campus are a build programme rather than a commissioning schedule. Announced capacity and available capacity are separated by years of electrical work, everywhere. The generation question is the one still being settled. The Gulf has abundant solar resource and abundant gas, and AI data centres need firm round-the-clock supply that solar alone does not provide without storage at a scale not yet built anywhere. Both countries hold net-zero commitments, and a multi-gigawatt AI campus is a material addition to national load. How that load is generated is being worked through by the utilities and the regulators alongside the compute programmes, and the supply agreements signed at LEAP are the first visible instalments of that work.