OpenAI, SoftBank pour $1B into data center developer SB Energy
What's the story
OpenAI and SoftBank Group have jointly invested $1 billion in SB Energy, a company focused on developing infrastructure for artificial intelligence (AI). The investment will be split equally between the two tech giants, with each contributing $500 million. The funding will help SB Energy expand its operations as a developer and operator of data centers.
Project details
SB Energy to build OpenAI's Texas data center
SB Energy has been selected by OpenAI to develop and manage a 1.2 gigawatt (GW) data center in Milam County, Texas. A single GW is enough to power around 750,000 US homes at any given time. The companies did not disclose the valuation for their investment but emphasized its importance in meeting their ambitious AI goals.
Power race
Energy demand surges as tech firms expand AI capabilities
The growing demand for energy to support larger data centers is driving up electricity consumption. To meet this need, some tech companies are investing in energy suppliers or plants, or establishing their own power sources. Meta Platforms Inc., for instance, has signed agreements that could eventually amount to over 6 GW of nuclear power.
Company growth
SB Energy's evolution and future plans
Originally a renewable and storage developer, SB Energy has expanded into developing, owning, and operating data centers in recent years. The company secured $800 million last year from Ares Infrastructure Opportunities funds. The latest investment from OpenAI and SoftBank will further bolster its capabilities as a data center developer/operator.
Project overview
Stargate initiative: A $500 billion AI data center project
The investment in SB Energy is part of OpenAI's Stargate initiative, a joint effort with SoftBank and OracleCorp. The project aims to invest $500 billion in AI data centers and infrastructure in the US over four years. The first site is a massive data center in Abilene, Texas, developed by Oracle and built alongside development partner Crusoe.