Daily SumUp

BlackRock, Global Infrastructure Partners (GIP), Microsoft and MGX this week announced the formation of the Global AI Infrastructure Investment Partnership (GAIIP) to make investments in data centers and the energy infrastructure to power them.

The partnership will initially seek to unlock $30 billion of private equity capital over time from investors, asset owners and corporate partners, which in turn would mobilize up to $100 billion in total investment potential when including debt financing.

Chip maker NVIDIA will also support GAIIP, offering its expertise in AI data centers and AI factories to benefit the AI ecosystem. Infrastructure investments would be chiefly in the United States, with the remainder invested in U.S. partner countries.

“Mobilizing private capital to build AI infrastructure like data centers and power will unlock a multi-trillion-dollar long-term investment opportunity,” said Larry Fink, Chairman and CEO of BlackRock. “Data centers are the bedrock of the digital economy, and these investments will help power economic growth, create jobs, and drive AI technology innovation.”

The partnership brings together leading technology investors BlackRock, GIP, and MGX, with Microsoft’s expertise. MGX was created in Abu Dhabi earlier this year to invest in AI and advanced technologies with other global partners.

Technology giants like Microsoft, Google and Amazon are significantly driving electricity demand, primarily through extensive and rapidly expanding data center operations. These data centers are essential for supporting cloud services, AI development and other digital operations. The facilities require vast amounts of power to run servers, cooling systems and other infrastructure needed to store and process massive amounts of data.

“The capital spending needed for AI infrastructure and the new energy to power it goes beyond what any single company or government can finance,” said Brad Smith, Vice Chair and President of Microsoft. “This financial partnership will not only help advance technology, but enhance national competitiveness, security, and economic prosperity.”

According to a study released by EPRI this year, data centers could consume up to 9% of U.S. electricity generation by 2030 — more than double the amount currently used. This could create regional supply challenges, among other issues.

According to a more recent analysis from McKinsey, the United States is expected to be the fastest-growing market for data centers, growing from 25 GW of demand in 2024 to more than 80 GW of demand in 2030.

Since access to power has become a critical factor in driving new data center builds, McKinsey says the “power sector is rapidly becoming a protagonist in the AI story.”