Nvidia investing $1.5B in SoftBank data center developer behind OpenAI project

In a significant move for the AI industry, Nvidia has announced a $1.5 billion investment in SB Energy, a data center developer associated with SoftBank and OpenAI. This investment secures Nvidia's position as the exclusive supplier of compute infrastructure for OpenAI's Ports-Pike data center, located near Cincinnati, Ohio. SB Energy's proposed facility, which could expand from 4.25 gigawatts to 8 gigawatts, has been the subject of a recent filing with the SEC.

SB Energy's current investors comprise SoftBank and OpenAI, the latter of which previously owned $5.8 billion worth of Nvidia stock, which was divested in November to fuel additional AI-related ventures. The data center and power developer are set to construct a 9.2 gigawatt natural gas power plant on the site, which is owned by the U.S. Department of Energy. The land has a notable history, having once been utilized for enriching uranium for the U.S. nuclear arsenal and powering U.S. Navy submarines.

The cost of the power plant is projected to reach $33 billion, a figure that underscores the escalating expenses associated with building natural gas power plants. These costs have surged by 66% over the past two years, as reported by BloombergNEF. As SB Energy's power plant and other facilities near completion, they will vie for natural gas resources with export markets. This competition could potentially lead to a tripling of natural gas prices in certain regions across the country.