Ulaanqab emerges as AI computing hub

Ulaanqab's cool climate further reduces energy demand. With an average annual temperature of around 4.3 C, the city can use naturally cold outdoor air to cool data centers for up to 10 months a year. This is a significant advantage for AI computing facilities, where high-performance chips generate substantial heat and require continuous cooling to maintain stable operation. In warmer regions, mechanical cooling systems consume additional electricity to dissipate this heat, increasing operating costs. Ulaanqab's low temperatures reduce reliance on energy-intensive cooling equipment, helping data centers lower power consumption and devote more electricity to computing.

Fast connections to Beijing enable remote computing services. Located about 300 kilometers from Beijing, Ulaanqab has two dedicated, high-capacity fiber-optic routes linking it to the capital. Network latency between the two cities can be as low as 4.2 milliseconds, allowing businesses to keep research, development, and other operations near Beijing while running computing-intensive workloads in Ulaanqab. The arrangement supports China's "East Data, West Computing" initiative, which channels computing demand from eastern regions to areas with greater energy and land resources.

Beyond its natural advantages, Ulaanqab has spent more than a decade building its data center industry. Since entering the big data sector in 2013, the city has introduced targeted policies to attract investment and support industrial growth. Its Three-Year Action Plan for Building a "Token Capital" (2026–28) sets out a roadmap to develop from a cloud computing hub into an intelligent computing center and, ultimately, a hub for AI token generation. Revised preferential policies for the big data service outsourcing industry provide support for land and premises, business operations, and talent recruitment.