SoftBank and AEP plan massive Ohio gas-fired AI data center campus
- Officials say project strengthens US position in AI race
- Japan to invest more than $33 billion
- Potential new model for data center building boom
WASHINGTON, March 20 (Reuters) – The U.S. Department of Energy on Friday announced a partnership between Japan’s SoftBank Group (9434.T), and electric utility AEP (AEP.O), to build a colossal gas-fired power plant and data center on federal land in Ohio.
The arrangement, which would involve building a 10-gigawatt artificial intelligence server warehouse, is part of a wider Washington-Tokyo trade deal.
SB Energy, a unit of SoftBank, plans to connect a 9.2-gigawatt gas plant to the local grid and power the new data center at the federally owned Portsmouth site in Pike County, Ohio.
If constructed, the gas plant and data center would be among the world’s largest. One gigawatt can power nearly 1 million homes.
During the Cold War, the U.S. produced enriched uranium for weapons at Portsmouth. Billions of dollars have been spent on decontaminating the site and its hundreds of buildings.
The public-private partnership includes $33.3 billion in funding from Japan, the Department of Energy said.
The investment is part of a U.S. trade deal with Japan struck in October that committed to invest $550 billion across the United States on nuclear power, rare earth minerals and other projects as both countries looked to reduce China’s dominance in electronic components.
Secretary of Commerce Howard Lutnick, said:
With this historic trade deal we are reindustrializing the country through critical projects like this $33 billion power project,
Friday’s announcement also said SB Energy is investing $4.2 billion with AEP Ohio to upgrade and build transmission lines in southern Ohio.
Masayoshi Son, chairman and CEO of SoftBank Group Corp, said the deal strengthens U.S. artificial intelligence leadership and helps to secure capacity for energy and computing.
U.S. Energy Secretary Chris Wright said the U.S. government “is leveraging its assets – like our federal lands – to add power generation, create jobs, and ensure the United States wins the AI race.”
POWER BILLS
The White House, the technology sector and power industries are seeking to calm fears that building data centers to meet AI demand will raise electricity rates for homes and businesses.
Electric utilities have broadly charged households and small businesses for power expenses related to serving data centers, said Ari Peskoe, an energy lawyer and Harvard professor.
The Ohio arrangement may present at least a partial solution to the problem of the public paying for costly data centers that ultimately benefit wealthy technology companies, he said.
Peskoe said,
Perhaps this announcement signals a new way forward that charges data centers and not ratepayers for data center transmission
Environmental advocates say the Ohio power plant will result in decades of local pollution and global-warming emissions.
Neil Waggoner of the Sierra Club, said:
Recommitting it to decades of new pollution is another sign of this Administration prioritizing the wrong things,
Reporting by Timothy Gardner and Laila Kearney; editing by Barbara Lewis and Cynthia Osterman
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SoftBank and AEP plan massive Ohio gas-fired AI data center campus, source
