A B300 rack goes for about six hundred thousand dollars outside China. Inside China last month, one reportedly sold for two point eight million. Somebody in Southeast Asia is about to have a very awkward conversation with their landlord. Welcome to The Data Center Daily. It's Tuesday, November 10th. On the rundown: Nvidia's reported quota on Chinese cloud customers, the Senate permitting bill and its data center cost rules, Morgan Stanley's count of Texas and Ohio capacity put at risk by the new governors, and a SemiAnalysis visit to a wind-powered AI campus in Inner Mongolia.
Shane Downing, writing in Tom's Hardware and citing the Financial Times:
Nvidia has told cloud partners worldwide that at least 51% of their services must go to non-Chinese firms, while Chinese companies have bought more than 1 million Nvidia gaming and workstation cards this year to cover the shortfall. Meanwhile, a B300 rack that sells for about $600,000 internationally reportedly fetched $2.8 million in China last month.
Start with what is and isn't confirmed. Nvidia hasn't confirmed or denied the rule. Per the report, it came as verbal instructions through sales and regional teams, it applies globally rather than just in Asia, and existing deals and leases stand. New ones have to comply. Southeast Asian providers that want Nvidia Cloud Partner status now also need Fleet Intelligence tracking. This lands on the Southeast Asian operators first. Chinese tech groups have been their biggest clients, and one Singapore-based group told the FT it's difficult to find enough non-Chinese clients outside the US. If you built a hall in Southeast Asia around Chinese training demand, a fifty-one percent floor isn't a policy footnote. It's your utilization rate. Data centers that can't refill that demand could pull back supply. The other route, buying compliant cards, is just as tight. Chinese customers have ordered more than six million of the export-compliant RTX Pro 5500, against roughly three million Nvidia could reportedly make in 2027. More than three million of those orders come from ByteDance, Alibaba and Tencent, at about 11,400 dollars each, so over 35 billion dollars at sticker. Partners might actually get five to ten percent of what they asked for. Samples are due in December, with deliveries from the first quarter of 2027. And the 5500 is a PCIe card with no NVLink. The B300 has about three point four times the memory and five point seven times the bandwidth. So China is ordering the card it can get, not the card it wants. Meanwhile about six hundred thousand H200s are reportedly sitting in Hong Kong storage because Beijing is holding back import approvals. Both governments are squeezing the same pipe. On the domestic side, the article puts China's AI chip supply this year at up to three and a half million units, Huawei about one point six million of them, against demand well above five million. Legally, renting is still easier than owning. The Remote Access Security Act, which would extend export controls to overseas cloud access, has passed the House but not the Senate. Next markers: Nvidia's third-quarter results on Tuesday, November 17th, and a closed-door briefing lawmakers have asked Jensen Huang to attend the following day.
Latitude Media, on the Senate permitting bill ahead of Monday evening's procedural vote:
Heinrich cited estimates by the Brattle Group that BAAJA would force data centers to pay $35 billion more for energy infrastructure over a decade compared with current law, due to provisions that effectively double-charge the industry for using the grid.
We've followed this bill, S. 5653, through the large-load cost thread. Monday's vote was on cloture, which needs sixty votes to move to floor debate. Latitude was writing before the roll call. Senators Martin Heinrich and Sheldon Whitehouse said they expected to have the votes after weekend changes that won over some utilities and labor unions who'd been on the fence. Put the numbers side by side. Brattle, as Heinrich cites it: thirty-five billion more over ten years. Grid Strategies, which we covered last week: about fifty-five billion over ten years in transmission alone. Same bill, a twenty billion dollar spread. Grid Strategies put about eighty-two percent of it in PJM and MISO, so developers modeling sites there should run both and plan for the higher one. The data center terms survived the amendment untouched. Per a Grid and Generation summary of the final substitute, new data centers with demand of twenty megawatts or more pay the full cost of grid upgrades needed to serve them, and those costs can't be passed to other customers. The amendment did add a concession for vertically integrated utilities, mostly in the Southeast: they're exempt from the mandate to plan transmission and generation together over twenty years and publish fixed upfront connection costs. It also adds an Energy Department Data Center Community Assistance Program, with no structure or budget defined. A program with no budget. That's the most Washington thing in the bill. The politics are what changed this weekend, though. Trump endorsed BAAJA on Sunday and said it codifies the White House's ratepayer protection pledge. The NRDC came out against it the same day, over faster oil and gas buildout, LNG terminals included, and limits on states and courts blocking those projects. Tribal nations are still opposed too. Heinrich framed it around the midterms: voters, he said, want Congress focused on affordability. Rhodium projects household bills fifty to seventy-eight dollars a year lower by 2040 if it's enacted. If cloture held, the cost-allocation fight moves from FERC dockets and state commissions toward a federal floor. We'll have the outcome and what comes next for the bill.
UnHideA, summarizing a Morgan Stanley note dated last Friday:
Excluding projects under construction, Morgan Stanley estimates that a cumulative 12.4 GW of data-center IT capacity in the two states by 2030 is at risk of delay or cancellation, equivalent to 8% of the 152 GW of cumulative U.S. operating capacity the bank forecasts for 2030.
The two states are Texas and Ohio, both getting Democratic governors in January. By original in-service year, the bank counts 4.9 gigawatts at risk in 2028, 3.8 in 2029 and 3.7 in 2030. It assumes what's under construction proceeds, so 2027 is unaffected. And it hasn't cut its total forecast; it treats the 12.4 as an upper bound, and thinks new requirements from the governors are more likely to delay construction than to shrink the eventual buildout. That's the part I'd underline. A governor can pause permits by executive order. Governor-elect Hinojosa has argued for pausing new permits until legislation passes. But killing sales-tax exemptions, giving localities a veto or mandating union hiring needs the legislature, and Texas Republicans still run it. So the governor controls the clock, not the rulebook. The bank's other argument is about who wins if supply slows: incumbent colocation with secured power. Equinix has nine Texas facilities, about three percent of its 280 worldwide, and Morgan Stanley rates it overweight with a 1,250 dollar target. Digital Realty is more exposed. Dallas was 4.2 percent of its annualized gross rent in the third quarter, and its planned 80 megawatt, 300 million dollar Garland project depends on how the grid verification process is carried out. That one's equal-weight at 215. Scarcity pricing for whoever already has energized megawatts. Great for landlords, rough for the tenant who needed a new hall in 2028. And a caveat: this is a secondhand summary of a bank note, and the bank says its model already applies a thirty percent haircut to announced projects. For contrast, the projects answering ERCOT's questionnaire requested 177 gigawatts in Texas alone.
Newton Gitonga, writing in Tom's Hardware on a new SemiAnalysis site report:
While US developers are turning to on-site gas turbines to work around grid constraints, Envision is building its data center alongside wind farms, battery storage, and dedicated power infrastructure. Galaxy is located in Ulanqab, Inner Mongolia, and is being developed across four phases for two unnamed internet companies.
SemiAnalysis, which visited in September, says Envision delivered the first 120 megawatt phase in under a year. The plan is up to 800 megawatts of IT capacity by the end of 2027, close to the roughly 820 megawatts of critical IT SemiAnalysis has reported for Stargate Abilene. It puts construction cost below three million dollars a megawatt, about a fifth of a comparable US project. That's the firm's estimate, not an audited benchmark. The power setup is what I care about. Two dedicated wind farms, 420 megawatts, sited about eighty kilometers apart so they're less likely to go calm at the same time. Four-hour batteries. Envision is targeting more than sixty percent of the electricity for the first two phases from those farms, against an expected 240 megawatt load. All-in power runs about five and a half cents a kilowatt-hour. And the limits. Inner Mongolia wind runs a capacity factor of about thirty-five to forty percent, so firm supply is still needed for continuous AI load. Envision has also described the project at more than two gigawatts, even three, figures the reporting couldn't reconcile with the 800 megawatt IT number. The detail I didn't expect: a 5 megawatt hall where solid-state transformers take 10 kV AC straight to 800 volt DC at the rack. No low-voltage transformers, no UPS, no rectifiers. Last week the Goldman notes from DCD Connect said 800 volt DC won't be the majority design in new US AI halls before 2028. In Ulanqab it's already running, at pilot scale. No measured efficiency gain yet, but Envision plans a bigger deployment in later phases. For scale, SemiAnalysis puts Envision's wider Inner Mongolia plans at about three gigawatts, and a local report it cites counts nearly 30,000 construction workers on 22 data center projects in the surrounding zone.
If you've got a read on that Southeast Asian utilization question, or you're redoing a cost model because of BAAJA, we'd like to hear it. Write to datacenterdaily at lantern podcasts dot com. Especially if you're the one trying to refill a hall in Singapore. We have questions.
On the calendar: the Senate cloture count, Nvidia's earnings on the 17th and the Huang briefing on the 18th. We'll be back tomorrow, Wednesday, November 11th. And if anyone's selling a B300 rack for six hundred grand, I know some buyers. That's The Data Center Daily, part of the Lantern Podcasts family. I'm Sarah, he's Matt. See you tomorrow.