Microsoft and BlackRock want to raise $100 billion to 'emancipate themselves from the shackles' of insufficient power and increase data centers for their ambitious AI dreams

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What you need to know

• Microsoft and BlackRock have partnered to raise $30 billion to satisfy their AI needs, including new data centers and sufficient power supply.
• BlackRock's CEO admits AI efforts are expensive and could require multi-trillions of dollars to finance when building data centers worldwide.
• Microsoft CEO Satya Nadella says the initiative will expedite gathering resources to "build the infrastructure of the future and power it in a sustainable way."

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Did you know Google and Microsoft consume more power than 100 countries? Generative AI's electricity and cooling water demand is at an all-time high. Experts and researchers say the world might be on the brink of the most significant technological breakthrough with AI, but there won't be enough electricity to power its advances by 2025.

Key players in the AI landscape, like OpenAI and Microsoft, have openly been seeking alternative power sources, including nuclear fusion, to ensure their advances and efforts in the category aren't watered down due to a lack of enough power. As it happens, Microsoft and BlackRock have partnered to raise $30 billion to develop data centers for their AI ventures and the energy infrastructure to power them. 

For context, Microsoft and BlackRock are part of the Global Artificial Intelligence Infrastructure Investment Partnership (GAIIP) alongside other Global Infrastructure Partners (GIP), which specialize in investing in, owning, and operating some of the largest assets in energy, transport, digital infrastructure, and more.

GAIIP aims to raise $30 billion of private equity capital, which could help the group leverage up to $100 billion from investors, including debt financing. In an interview, BlackRock CEO Larry Fink indicated:

"The need to build out data centers globally is multi-trillions of dollars to finance. This is just a great example of the capital markets building out infrastructure and building out the opportunities and new technologies."

Microsoft CEO Satya Nadella says the initiative will expedite the process of pulling resources required to "build the infrastructure of the future and power it in a sustainable way." "We are committed to ensuring AI helps advance innovation and drives growth across every sector of the economy," Nadella added. 

Lack of sufficient power continues to cripple in AI advances 

Azure Data Center (Image credit: Microsoft)

Recently, most companies dabbling in the AI landscape have openly shown interest in making their efforts more sustainable, affordable, and environmentally friendly. Part of this process includes developing massive data centers that can be used to train and improve the capabilities of their AI-powered offerings.

This has resulted in a high demand for GPUs from NVIDIA. As it seems, the chip maker is reportedly facing a supply-and-demand problem. According to leaked emails between Elon Musk and NVIDIA, the billionaire asked the chipmaker to prioritize processor shipments to X and xAI ahead of Tesla due to the shortage of AI chips.

On the same topic, Elon Musk debuted xAI's Colossus project, which was developed in under 122 days. It's reportedly the most powerful AI training system in the world, powered by 100K NVIDIA H100 GPUs, and it trains Grok to become the most powerful AI by every metric.

Elsewhere, Microsoft and OpenAI invested $100 billion in a project dubbed Stargate to free themselves from the shackles and overreliance on NVIDIA for AI chips; the data center is expected to launch in 2028 and will help meet the companies' high demand for GPUs. Investors have started flagging issues with Microsoft's exorbitant expenditure on AI projects, as there are minimal returns to show in terms of profit.

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