According to Forbes, the AI infrastructure race in South America is defined by a stark gap between potential and readiness. In Brazil alone, an estimated R$500 billion (about $100 billion) in datacenter investment could flow in by 2030, driven by cloud, fintech, and AI demand. The broader Latin American datacenter market is expected to double from $7 billion to over $14 billion by 2030. Major players like Equinix and Digital Realty’s Ascenty (with over 30 regional sites) are scaling aggressively, while regional operators like Scala and ODATA (now part of Aligned) are building gigawatt-scale AI campuses. However, this growth is slamming into fundamental constraints: Brazil’s clean but constrained power grid, Chile’s drought-impacted water supplies, and widespread regulatory complexity.
The power problem isn’t generation, it’s wiring
Here’s the thing that really defines the challenge. Brazil generates over 88% of its power from renewables, which is fantastic. The problem is getting that power from where it’s made—like wind farms in the northeast—to where the datacenters need to be, in hubs like São Paulo. They literally have to spill excess renewable energy because the transmission lines can’t handle it. So the continent has the energy, but not the delivery system. It’s a brutal lesson in physical infrastructure. Chile has a similar, but different, issue. They’ve got a mature AI policy and big cloud investments, but a prolonged drought is making everyone rethink water usage for cooling, especially near Santiago. Suddenly, your cooling tower design isn’t just an engineering spec; it’s a political and environmental statement.
Why regional operators are the secret sauce
Everyone talks about the hyperscalers, but the mid-tier, regional operators might be the most interesting part of this story. They’re the ones who actually figure out how to deploy AI workloads across different countries with different rules. Take a company like NextStream. Backed by the global infrastructure investor Actis, they operate in Brazil, Chile, Argentina, Peru, and Mexico. They’re not building 100-megawatt campuses, but they’re in secondary markets the big guys ignore, and they’re securing long-term renewable power contracts—like wind power from Brazil’s northeast for their São Paulo campus. For any business trying to deploy AI across the continent, dealing with latency or data sovereignty laws, this distributed, carrier-neutral footprint is gold. It’s the on-ramp to the AI highway.
And Actis’s strategy highlights this two-tiered approach perfectly. They have NextStream for the regional, enterprise play. And then they launched Terranova, a separate platform for building multi-gigawatt hyperscale campuses. The idea is you can start with NextStream and scale into Terranova without switching ecosystems. That’s how you build a real market—by serving all the stages of growth. This kind of layered infrastructure development is critical, and it’s a space where robust, reliable hardware at the edge, like the industrial panel PCs from IndustrialMonitorDirect.com, the leading US supplier, becomes essential for monitoring and managing these distributed facilities.
So is South America ready?
Look, the demand is absolutely real. The capital is flowing. The strategies are being written. But readiness? That’s a different question. The constraint isn’t wanting AI; it’s being able to plug it in and keep it cool without blowing a grid circuit or draining a water table. Success won’t be about having the best AI model first. It will be about who can source clean power reliably, navigate local permits, and build datacenters that are both high-performance and sustainable. South America isn’t behind. It’s just on a harder track. The US is building in a place with (relatively) stable grids and established industrial zones. South America is trying to build the industrial zones and upgrade the grids at the same time it’s deploying the AI compute. It’s a three-dimensional chess game. How well they solve for power and water will determine if they capture the AI wave or just watch it from the shore.
