Rio Grande do Sul to Simplify Licensing for South America's Largest Data Center in Eldorado do Sul

The Rio Grande do Sul government will provide simplified environmental licensing for the largest data center in South America, to be built by Scala Data Centers in Eldorado do Sul, near Porto Alegre. The protocol signed in September 2024 commits the government to expedite licensing processes, which will not require an Environmental Impact Study. The data center, named Scala AI City, is expected to demand significant energy, with a projected load of 5 GW by 2035, surpassing the state's current energy consumption.

Published Mar 23, 2026

The Rio Grande do Sul government is facilitating simplified environmental licensing for Scala Data Centers' project in Eldorado do Sul, set to become South America's largest data center. Signed in September 2024, the protocol assures swift licensing and support for Scala's operations.

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The center will focus on AI training, requiring up to 5 GW of power at full capacity, raising concerns about local energy stability. The government is tasked with assisting Scala in obtaining necessary energy grid connections, as the initial capacity is limited to 1.8 GW. The project has faced scrutiny over potential environmental impacts, including water quality and local energy supply issues, and lacks public hearings under the simplified licensing process.