Subscribe to the Data Center Knowledge Newsletter
Get analysis and expert insight on the latest in data center business and technology delivered to your inbox daily.
Microsoft, BlackRock Launch $30B AI Data Center Investment Fund
The infrastructure investment agreement will create new and expanded data centers, primarily in the US.
James Walker
September 18, 2024
4 Min Read
A new investment partnership will seek to unlock $30 billion of private equity capital for data centers.Image: Alamy
Digital infrastructure investments remain strong heading into the fourth quarter, with BlackRock, Global Infrastructure Partners, Microsoft, and MGX launching a new partnership to drive the expansion of data centers in the US.
The news comes as public and private entities around the world seek new ways to meet AI’s escalating energy demands while maintaining grid reliability and data center sustainability.
In a joint statement yesterday (September 17), the quartet of tech and asset management firms said the Global AI Infrastructure Investment Partnership (GAIIP) will seek to unlock $30 billion of private equity capital to drive the efficient scaling of data centers.
The funds will be used to “make investments in new and expanded data centers to meet growing demand for computing power, as well as energy infrastructure to create new sources of power for these facilities.”
Chipmaker Nvidia will support the GAIIP, offering its expertise in AI data centers and AI factories. The investments will be primarily in the US, with the remainder being invested in US “partner countries.”
AI’s rising power demands could push data centers to use 4% of global energy by 2029.
High Energy
Addressing the AI energy issue is one of the most critical challenges facing the industry today. According to a Goldman Sachs report earlier this year, data centers worldwide currently consume 1-2% of overall power, but this percentage could rise to 3-4% by 2029.
This increase is due in no small part to the ongoing growth of power-hungry AI services. “A ChatGPT query needs nearly 10 times as much electricity to process as a Google search,” the report said.
The issue hasn’t escaped the attention of government agencies. Just last week, Data Center Knowledge reported that the US Department of Energy (DOE) has partnered with data center experts to address the escalating energy needs of AI and digital infrastructure.
A new DOE report, ‘Recommendations on Powering Artificial Intelligence and Data Center Infrastructure’, highlights the soaring power demands from data centers, particularly those driven by AI applications.
Earlier this year, BlackRock, one of the key stakeholders in this latest industry partnership, said the AI revolution would continue to add fuel to the data center boom.
In a report published over the summer, the investment giant said it saw the potential for massive data center growth in the coming years, fueled largely by demand for AI workloads.
“If we look at the growth of AI data center, it is expected to increase on an annual basis somewhere between 60 to 80% in the coming years,” Wei Li, BlackRock global chief investment strategist, said during a press briefing.
Read our coverage of the report for full details.
‘The Bedrock of the Digital Economy’
According to the GAIIP stakeholders, the partnership will initially seek to unlock $30 billion of private equity capital. The group will also “actively engage” with industry leaders to help enhance AI supply chains and energy sourcing for the benefit of the data center industry.
Commenting on the deal, Satya Nadella, chairman and CEO of Microsoft, said: “We are committed to ensuring AI helps advance innovation and drives growth across every sector of the economy. The GAIIP will help us deliver on this vision, as we bring together financial and industry leaders to build the infrastructure of the future and power it in a sustainable way.”
Read more of the latest data center investment news
Larry Fink, chairman and CEO of BlackRock, said: “Mobilizing private capital to build AI infrastructure like data centers and power will unlock a multi-trillion-dollar long-term investment opportunity. Data centers are the bedrock of the digital economy, and these investments will help power economic growth, create jobs, and drive AI technology innovation.
“Building the necessary infrastructure required to advance and accelerate the adoption of AI will reshape and revitalize almost every aspect of how we live,” said Ahmed Yahia Al Idrissi, CEO of MGX. “Similar to our transportation infrastructure, new data centers, and power sources will enable growth and commerce in the future innovation economy.”
Investment vehicle MGX was created in Abu Dhabi earlier this year to invest in AI and advanced technologies with global partners.
About the Author
You May Also Like
