The massive $100 billion Stargate joint venture will reportedly be powered, at least in part, by solar energy and batteries.
According to a Bloomberg report, SoftBank-backed SB Energy will build the renewable power installations for Stargate, although these sources will likely not be the venture’s only power source. Stargate, a partnership between OpenAI, Oracle, and SoftBank Group, is set to develop a network of new data centers aimed at supporting artificial intelligence applications.
The increasing reliance on cloud computing and AI in recent years has intensified the need for reliable power sources. The U.S. Department of Energy estimates that data centers could consume up to 12% of all U.S. electricity by 2028, up from 4.4% in 2023. This surge in energy consumption could result in 50% of new data centers being underpowered by 2027.
Nuclear Energy and Other Power Sources
Nuclear power has become a key option for tech companies and data center developers. Google has signed a 500-megawatt agreement with nuclear startup Kairos, while Microsoft is reopening a reactor at Three Mile Island. Additionally, data center operator Switch struck a deal with Sam Altman-backed Oklo for 12 gigawatts of capacity from small modular reactors.
Despite these advances, the nuclear industry has faced delays and cost overruns. Many of the newer nuclear startups aim to address these challenges by modularizing reactor components, which could speed up the construction process. However, none of these startups have completed a reactor yet, with the first commercial reactors not expected until 2030, making them insufficient to address the current energy shortage.
Natural gas power plants, another option for data centers, will also take years to build, leaving solar and wind as quicker solutions.
Solar and wind farms are far quicker to build than nuclear or natural gas plants. According to a study of 50 years’ worth of power plant projects, solar and wind can be completed in about half the time of other energy sources. More recent estimates suggest solar plants typically take around 18 months to finish. The modular nature of solar projects allows them to begin generating power before the entire project is completed.
For data centers, grid connections can be optional, and many could take power directly from the source. Given the urgency of Stargate, it’s possible that permitting processes could be accelerated, making solar energy a likely frontrunner for powering the first Stargate data centers.
Author’s Opinion
Stargate’s reliance on solar power is a smart choice given the growing urgency of the energy demands for AI and cloud computing. While nuclear power and natural gas plants might offer long-term solutions, the reality is that they take too long to build and face substantial delays. Solar energy, on the other hand, can be deployed much faster, and its modular nature makes it a perfect fit for the rapidly expanding data center industry. As the demand for AI and cloud computing grows, it’s clear that renewable sources like solar will play an increasingly pivotal role in powering the future of tech.
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