The ambitious $100 billion Stargate collaboration will reportedly incorporate solar energy and battery storage as part of its power sources.
According to a Bloomberg report, the renewable energy systems will be developed by SB Energy, which is backed by SoftBank. However, these installations are expected to be just one of multiple energy sources for the venture. The Stargate initiative is a partnership involving OpenAI, Oracle, and SoftBank Group, aimed at establishing a series of new data centers to support artificial intelligence technologies.
There has been a significant surge in cloud computing and AI development, prompting tech companies to rapidly secure energy resources. The U.S. Department of Energy predicts that data centers might account for up to 12% of the total power generated in the U.S. by 2028, an increase from 4.4% in 2023. This rising demand could result in nearly half of new data centers being underpowered by 2027.
Nuclear energy has gained popularity among data center developers and tech organizations. For instance, Google has signed a contract for 500 megawatts with the nuclear startup Kairos, while Microsoft is planning to reactivate one of the closed reactors at Three Mile Island. Additionally, data center operator Switch announced a deal in December with Oklo, a small modular reactor company backed by Sam Altman, securing 12 gigawatts of capacity.
Nevertheless, the recent history of nuclear energy has been marred by cost overruns and project delays. Many of the new nuclear startups have been established with the goal of addressing these challenges through the modularization and mass-production of reactor components. If successful, this strategy could expedite the approval and construction processes for new nuclear facilities.
Despite these advancements, none of the new startups have yet to finalize a reactor, and the first commercial units are not projected to be operational until 2030, which does little to alleviate the immediate energy shortfall. Additionally, natural gas power stations, another potential energy source for data centers, also require several years for completion.
In contrast, solar and wind farms can be established much more rapidly. Research indicates that these projects can typically be finished in about half the time of nuclear and natural gas plants, based on 50 years of data. Recent estimates suggest that the average completion time for a solar power facility is approximately 18 months. Due to their modular design, solar plants can begin generating electricity even before the entire project is finished.
The most time-consuming aspect of solar initiatives is often the permitting and interconnection phase, which involves linking the facility to the power grid. However, for data centers, grid connections are optional—many can potentially draw power directly from the source. Given the urgent nature of the Stargate project, there’s a chance that the permitting process could be expedited, making solar energy the leading option for powering the initial data centers.
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