China’s Loess Plateau Computing Hub Becomes Token Factory
Deep in the Loess Plateau of northwestern China, the city of Qingyang in Gansu Province is undergoing a remarkable transformation. Once known primarily for its oil and gas reserves, Qingyang has emerged as a critical node in China’s national computing power network, rapidly evolving into what industry observers are calling a “token factory” — a hub where artificial intelligence tokens are generated, processed, and distributed at unprecedented scale.
According to Xinhua News, the Qingyang “East Data West Computing” industrial park has already installed 102,000 standard server racks with a total computing power of 142,000 PFlops — equivalent to 142 quadrillion floating-point operations per second. This massive infrastructure supports the training and inference of large AI models that now underpin applications from autonomous driving to medical diagnostics.
The Token Economy Takes Off
Tokens — the fundamental units of data that large language models process — have become a critical metric in China’s AI economy. The National Data Administration reports that daily token calls across the country surpassed 140 trillion as of March 2026, a 40% increase from the end of 2025. This explosive growth reflects the rapid adoption of generative AI across industries and everyday life.
Qingyang’s location offers distinct advantages for this compute-intensive industry. Situated at the intersection of the Hu Huanyong Line and the Bo-Tai Line, the city lies within 2,000 kilometers of all major Chinese metropolitan areas including Beijing, Shanghai, Guangzhou, and Shenzhen. Its cool climate reduces data center cooling costs, while its stable geological conditions provide operational security.
Green Energy Powers the Digital Revolution
Computing power is an energy-intensive business — electricity accounts for over 50% of operating costs at AI computing centers. Qingyang’s abundance of wind, solar, and fossil fuel resources gives it a competitive edge. A green energy aggregation pilot project, built by Gansu Electric Investment Qingyang New Energy, has begun supplying the industrial park with clean electricity.
“Approximately 55% of the park’s electricity comes from green aggregation, with the remainder supplemented through the power market, ultimately achieving a unit price of no more than 0.4 yuan per kWh,” said Wang Jiaxue, head of the project, as reported by Xinhua.
Nearly 600 Digital Enterprises Take Root
The industrial park has attracted nearly 600 digital enterprises, including major players like Kingsoft Cloud and Xiaomi Group. Yang Jinwei, Northwest General Manager of Kingsoft Cloud, noted that the company’s integrated computing power scheduling platform has successfully connected to Qingyang’s data center, with plans to support Kingsoft’s WPS AI business expansion and Xiaomi’s autonomous driving model development.
Dong Zongmou, Deputy Director of the Qingyang Industrial Park Management Committee, told Xinhua that the number of enterprises visiting for research and lease negotiations has increased noticeably. “Recently, phone inquiries and on-site inspections by enterprises have been very frequent. The park is accelerating its construction pace to meet market demand,” he said.
Policy Support Accelerates Development
The transformation has received strong backing from China’s central government. The 2026 Government Work Report, for the first time, explicitly called for building a “new intelligent economy” and designated “ultra-large-scale intelligent computing clusters” and “computing-power-electricity coordination” as key infrastructure projects. In May 2026, the State Council elevated the computing power network to the same strategic level as water and power grids, as part of a “six networks” framework.
Real-World Impact
The benefits of this digital transformation are already reaching local communities. East Group Digital Equipment, a manufacturer operating in the park, achieved a production value of 590 million yuan by the end of 2025, filling a gap in local manufacturing and creating jobs, according to Kou Long, the company’s head.
Applications powered by Qingyang’s computing resources span diverse sectors: drones equipped with infrared thermal imaging inspect oil and gas pipelines for Changqing Oilfield; AI systems at an apple sorting center assess sugar content, color, and size of individual fruits in 0.5 seconds; and a traditional Chinese medicine AI system named “Qibo Cloud” provides diagnostic support to grassroots clinics.
What’s Next
As China’s AI industry enters a new phase focused on computational efficiency and large-scale deployment, Qingyang faces both opportunities and challenges. The city must develop talent pipelines, strengthen financial services, and ensure data security management to sustain its growth. With eight national computing hub nodes competing for investment and talent, Qingyang’s ability to leverage its unique geographic and energy advantages will determine whether it can maintain its position at the forefront of China’s token economy.
Gansu Provincial Party Secretary Hu Changsheng, writing in People’s Daily, emphasized that the province is anchoring its development in intelligent, green, and integrated growth — a vision that Qingyang’s transformation from oil town to token factory embodies in real time.