Telecommunications giant TELUS is moving forward on plans to grow its AI data centre footprint in B.C, with an expansion in Kamloops and the launch of new facilities in Mount Pleasant and downtown Vancouver. 

The company’s AI cluster pitch is the first to be supported by the federal government as part of its calls for large-scale AI centre proposals.

At a Vancouver-area announcement Monday, federal Artificial Intelligence and Digital Innovation Minister Evan Solomon said “Canada cannot compete in the AI company without the infrastructure to back it up.”

“By advancing this project with TELUS, we are taking concrete action to build sovereign AI capacity here in Canada,” he added.

There are no federal dollars involved at this stage, said a spokesperson for Minister Solomon in response to questions on financing from iPolitics. 

“Off-take agreements or contractual arrangements could potentially form part of a project structure in the future, but these are bespoke arrangements and terms would be determined on a project-by-project basis.”

Together, TELUS facilities in B.C. could require some 150 megawatts of electricity by 2032. The company intends on using hydropower.

The government received 160 applications in its call for large-scale sovereign AI data centre proposals, which ran earlier in February. 

As part of that program, Ottawa plans to enter into a non-binding memorandum of understanding (MOU) with selected companies to “explore mechanisms” that could help build large data centres. 

TELUS is the first proposal the government is moving forward with, while others remain under active consideration.

“We have a real pipeline for AI infrastructure projects,” Solomon said. “It tells you that the Government of Canada also has a role to enable that ambition and to turn it into capacity.” 

Government laid out selection criteria

In deciding which projects to support, the federal government laid out criteria that included economic benefits, indigenous participation, energy considerations and costs, among others.

The submission form included questions about where the data would be stored, and if the proponent behind the project is majority-controlled by a Canadian company.

The TELUS projects will cost roughly $9-billion and help create about a thousand construction jobs and hundreds more permanent positions, according to government numbers.

The goal is to help seed a broader Canadian AI ecosystem through partnerships between companies including Westbank, Allied Properties REIT, and Creative Energy. 

Telus president and CEO Darren Entwistle said the data centres will use “advanced cooling and waste heat recovery” to achieve efficiency three times better than industry global standards. 

“We harness the waste heat that is the byproduct of AI data centres by recycling this waste heat back into the electrical grid — these urban AI factories will keep away more than 150,000 homes just in metro Vancouver,” Entwistle said. 

READ MORE: Federal A.I. strategy is “coming very soon,” minister says

It is not clear how many other proposals will be picked by Ottawa, and when the government will make another announcement. 

Jim Balsilli, former co-CEO of Research in Motion and founder of the Centre for International Governance Innovation, praised the fact that TELUS is a domestic company on Canadian soil. 

He recently asked a House committee why the government cut its “first big check, the only big check to date, to a U.S. company when there are many Canadian companies that would be sovereign.” 

“So this represents a change from their first move, which is good. It shows how much interest there is for companies to participate,” he told iPolitics.

TELUS banking on AI momentum

TELUS hinted at an expansion of its B.C. ambitions in its latest earnings call. 

On Monday the company shared the Kamloops expansion and the Mount Pleasant facility will open later this year, while the downtown facility could come online in 2029.

These expansion projects come less than a year after the company opened its first sovereign AI factory in Rimouski. 

That facility quickly sold out, and TELUS views its success there as a clear validation of “the strong market demand for sovereign AI infrastructure and compute capabilities,” said Entwistle.

“We’re in a locker room”

Balsilli said Monday’s announcement is a huge step, but Canada remains in a “locker room” where the world’s claiming IP ownership. 

“I would caution against making any progress on IP because Canada’s so far behind with no artificial intelligence IP strategy,” Balsilli said.

Part of the announcement also noted that the infrastructure will rely heavily on NVIDIA GPUs and global supply chains. Balsilli pointed out that there are risks in having one single chip supplier. 

“I would strongly encourage an approach that has multiple vendors at the GPU level… that doesn’t affect sovereignty, per se, but it certainly affects the economics,” he said. 

Balsilli added that one of the biggest issues to watch is how much control companies like NVIDIA hold over both the hardware and the intellectual property ecosystem surrounding AI infrastructure. 

It remains unclear whether Telus is designing the system to support multiple vendors at this point, Balsilli said.