China’s first large-scale project to supply renewable energy directly to data centres started operating on Saturday.

The opening of the plant in the northwestern region of Ningxia, a major centre for wind and solar power, comes as Beijing tries to balance increased demand for electricity and computing power with its decarbonisation goals.

The project has a solar capacity of 500 megawatts – with a further 1.5 gigawatts of wind power planned by the end of the year – and is integrated to a cloud base in the city of Zhongwei, according to state broadcaster CCTV.

It is designed to coordinate energy supply and computing capacity so that the data centre can shift tasks to where renewable power supplies are plentiful or when electricity is cheapest to reduce strains on the grid and cut costs and emissions.

After the wind power element of the project is finished, it will generate 4.3 billion kilowatt-hours of electricity annually, equivalent to cutting carbon emissions by 3.65 million tonnes.

China is witnessing an explosion in demand for computing capacity that is largely driven by AI – which in turn has pushed up electricity use – and it is trying to manage this in light of its green energy transition, where the goal is to reach peak carbon emissions by 2030.