Energy Infrastructure Limiting Mexico's Data Centre Growth

Mexico’s data centre sector is expanding rapidly, with installed capacity rising from 115.5MW in 2024 to nearly 280MW today. This 142% increase highlights strong demand for digital infrastructure, but it also exposes growing pressure on energy systems.

Industry representatives warn that electricity planning and grid development are not keeping pace with this growth. The Mexican Data Centre Association (MEXDC) is raising concerns about a lack of coordination with government bodies responsible for energy policy and infrastructure.

Without a clear framework, operators are moving ahead with projects while managing energy challenges independently. This approach is enabling short-term growth but creating longer-term uncertainty for investors and developers.

Energy planning gaps emerge

The central issue identified by the Mexican Data Centre Association is a lack of alignment between the sector’s expansion and national energy planning. Attempts to engage with the Mexican Energy Ministry have not resulted in a coordinated strategy for meeting rising electricity demand.

Data centres require consistent high-capacity power to maintain uptime, making grid reliability essential. In Mexico, responsibility for this infrastructure sits with organisations such as grid operator CENACE and state utility CFE. However, developers report delays and limited visibility into how capacity will be expanded.

“The main constraint on new projects is no longer demand or capital, but the infrastructure required to make them viable,” the MEXDC has said in a statement, citing shortcomings in power supply network robustness and regulatory timelines.

In response, private investment is filling part of the gap. Around US$340m is being directed into dedicated electrical infrastructure in the Bajío region alone. While this supports individual projects, it places the burden of grid development on operators rather than public systems.

Adriana Rivera, Executive Director of the Mexican Data Centre Association, outlines what is needed to address the issue.

“Without sufficient, reliable and well-planned energy, digital infrastructure cannot develop,” she says.

Adriana points to the need for long-term public policy, stronger transmission and distribution networks and faster interconnection processes. These elements are essential for scaling data centre capacity while maintaining stability.

Regional competition intensifies

Mexico’s position within the Latin American data centre market reflects both its potential and its current limitations. Brazil leads the region with more than 900MW of installed capacity, while Chile has reached 258.5MW despite a much smaller population.

For data centre operators, location decisions depend on access to power connectivity and regulatory clarity. As neighbouring countries continue to expand, Mexico risks losing projects to markets that can provide more predictable conditions.

The Mexican Data Centre Association warns that some developments are already being redirected elsewhere. This creates a challenge for a country that benefits from proximity to the US and increasing demand for nearshoring linked to AI and cloud services.

Industry adapts to constraints

Despite these challenges, parts of the sector continue to progress by adapting to local conditions. Turner & Townsend, which works on several data centre projects in Mexico, notes that energy constraints are not consistent across all regions.

"Regarding energy, none of our clients face issues except those investing near the northern borders," says André Rizzo, Director of Industrial Science and Logistics for LATAM and Data Centre for Mexico at Turner & Townsend.

Water availability is another factor shaping design choices. Mexico’s climate requires careful management of cooling systems, which are essential for maintaining server performance. Operators are increasingly adopting closed-loop cooling, which recirculates water within the system to reduce or eliminate the need for fresh supply.

These adaptations allow projects to move forward, but they do not fully address the underlying infrastructure challenges. As capacity continues to grow, reliance on workarounds may become more difficult to sustain.

Amet Novillo, President of the Mexican Data Centre Association, frames the situation in terms of both progress and risk. “Expanding from 115.5MW to 279MW in an environment of energy constraints is a clear signal of the sector's potential, but also a warning: continuing without structural planning increases operational risks, delays projects and reduces national competitiveness."