Ulanqab reaches 165 EFLOPS of online AI compute

A city on the Inner Mongolian grasslands is now carrying 165 EFLOPS of online compute. Ulanqab, about 240 kilometers from Beijing, has become one of Asia-Pacific’s largest and fastest-growing AI compute clusters, with a fiber-optic round-trip latency of 4.2 milliseconds to the capital, according to Goldman Sachs.

The buildout is moving quickly. By June 2026, data-center operators and internet companies had committed roughly 12.5 gigawatts of capacity, nearly four times the 3.3 gigawatts committed in July 2025. Utilized data-center capacity grew more than 70% in 2025 to about 800 megawatts, while online compute doubled year over year by mid-2026.

Ulanqab’s advantage is a combination of geography, energy and price. The city has about a tenth of China’s effective wind area, more than 3,200 hours of annual sunshine and over 20 gigawatts of installed renewable energy. Around 67% of its power comes from green sources, and electricity tariffs of roughly 0.33 to 0.36 yuan per kilowatt-hour are about half those in the Beijing-Tianjin-Hebei region. Regulators require new AI compute centers to source at least 80% green power; Ulanqab’s new projects exceed 86%.

The names arriving show what the capacity is for: DeepSeek and Kimi have set up operations, while Tencent and ByteDance have deepened commitments. Data-center developers GDS Holdings and VNET Group are expanding too. Envision, a renewables company moving into AI data centers, has lit up its Xinghe base, a 120,000-square-meter facility planned around 2 gigawatts of capacity and built around direct green power and large-scale interconnection.

So what changes in practice? AI companies gain a new place to run compute-intensive services close to Beijing, with a large pool of online capacity and a lower-cost, greener electricity supply. But this is still a buildout rather than a finished system: Envision’s Zheng Zihao says storage must absorb GPU demand surges, while transmission infrastructure is China’s real constraint. The company expects Ulanqab’s capacity to scale substantially from 2028 onward, so the headline numbers describe momentum as well as available compute.