AI Data Centers Face a New Bottleneck: Power-Cable Supply

Artificial-intelligence data centers are running into a less visible constraint: the industry may not be able to manufacture power cable quickly enough for every planned project. Vincent Piquet, chief financial officer of French cable maker Nexans, told Reuters that demand is rising faster than manufacturing capacity.

Building a new cross-linked polyethylene cable production line, known in the industry as a CV line, takes about three years, Piquet said. That long lead time limits how quickly suppliers can respond when developers bring forward large data-center projects.

Why cable matters to AI infrastructure

Data centers need large volumes of low- and medium-voltage cable to connect their power systems. Larger facilities consume proportionately more medium-voltage cable. Nexans says AI racks are also pushing power density higher and that critical electrical equipment can have lead times of 18 to 36 months.

The cable shortage is developing alongside wider grid constraints. Reuters reported that Oracle issued a force-majeure notice in September to a New Mexico data-center developer, citing possible difficulty securing enough power. Piquet said those constraints can slow individual projects while supporting demand for Nexans products and allowing the company to choose where to allocate capacity.

Longer contracts and regional differences

French network operator Enedis has moved from annual procurement agreements to contracts lasting six or seven years, Piquet said. Europe generally has stronger electricity networks than the United States in some northern countries, but regulatory delays continue to hold back projects. He expects AI-linked demand to remain strong, although Europe’s expansion may be less pronounced because private investment capacity is smaller and public funding plays a larger role.

Illustrative file photo of electrical wiring; not a Nexans product or a data-center installation described in this report. Photo: Matthew Guay / Unsplash. Unsplash License; cropped to 16:9. Image source; license.

Sources

Reuters report; Nexans data-center cable information.