The noise is deafening inside the drab metal building...
Hundreds of thousands of fans blast cold air. Six giant ceiling turbines spin with the force of 360 washing machines.
Located just outside the Reykjavík airport, this is the sound of Genesis Mining's Enigma facility. It's just one of the cryptocurrency miners and data-center operators that has set up shop in Iceland.
The nation lured these businesses with its endless (and cheap) supply of renewable energy and year-round cool temperatures. This helps power server farms and keeps them from overheating.
In 2018, by some estimates, bitcoin mining alone was using up more electricity than all of Iceland's homes combined. AI companies and cloud giants soon followed... Firms like atNorth built sprawling server farms powered by geothermal plants and hydroelectric dams.
It seemed like a win for Iceland's economy. The rise of data centers brought fresh jobs and injected foreign capital, while keeping the carbon footprint remarkably low.
But former Prime Minister Katrín Jakobsdóttir saw a problem...
You see, while Iceland's server farms are thriving, its farmers face mounting challenges...
Energy shortages hamper their ability to grow food in greenhouses. Fish-processing plants – once a pillar of the national economy – are forced to run diesel generators.
The electric grid just can't meet local needs. And food prices are climbing as a result.
The same energy that made Iceland a tech magnet is now causing shortages for its own people. With a population of about 370,000, the nation only has so much electricity to give.
If it keeps funneling so much power into server farms, there won't be enough left for basic needs like food production.
Jakobsdóttir wants Iceland to reprioritize how it distributes its energy. And as for companies that seek the country's renewables...
They'll have to solve their energy problems closer to home.
Tech companies need to find their own ways to keep servers cool back on U.S. soil.
And plenty of other facilities face a similar issue... like manufacturing plants, office buildings, schools, and hospitals. These businesses don't have the luxury of setting up shop wherever it's most convenient.
That tall order brings us to an opportunity for investors.
Heat is one of the biggest challenges of the AI era...
Standing up a data center isn't as easy as stacking servers in a warehouse. These facilities run hot. And the more complex AI models become, the more heat they generate.
A single rack of graphics processing units ("GPUs") can consume up to 100 kilowatts... nearly 100 times more than a typical home. Multiply that by hundreds of racks, and you're looking at the heat output of a small town.
If those machines overheat, it can throttle performance – or cause outright failure.
That's where heating, ventilation, and air conditioning ("HVAC") specialists come in. Their job is to design cooling systems that work around the clock to keep data centers at the right temperature.
As demand for AI and cloud computing explodes, so does the need for temperature management.
HVAC contractors are being called in earlier and more often... and they can barely keep up with demand.
In other words, you don't have to invest directly in data centers to win in this market. Look at the service providers that keep AI running.
The right HVAC stock could turn out to be just as profitable as an AI darling.
Regards,
Joel Litman
December 19, 2025
