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A new company promises to invest $500 billion in AI infrastructure over the next four years.
FORT WORTH, Texas — On the first full day of his second term, President Donald Trump announced the formation of a new company that promises to spend billions on infrastructure supporting artificial intelligence.
Tech industry heavyweights SoftBank, OpenAI, Oracle and MGX are the first to invest in the Stargate Project, the new company.
The entity aims to spend $500 billion over the next four years to “secure American leadership in AI, create hundreds of thousands of American jobs, and generate massive economic benefit for the entire world,” a press release said.
“The announcement of project Stargate is an enormous amount of money to be spent on AI infrastructure: data centers, power, grid interconnectivity – all the things you need to build AI systems that are in the hardware space,” Abundance Institute head of AI Neil Chilson said.
Chilson, a former technology expert for the Federal Trade Commission, compared the proposed investment in artificial intelligence to the initial expenditure on the interstate highway system. The inflation-adjusted dollar amounts are similar, he said.
Stargate officials say the company will immediately deploy $100 billion. Construction on the first Stargate-backed project, a data center in Abilene, is already underway.
“This is a huge opportunity for Texas,” Chilson said.
There are already close to 400 data centers in the Lone Star State, according to market analytics firm Baxtel. Dallas-Fort Worth is among the world’s largest hubs for data centers.
Chilson said Texas’s population, geographic size and relatively loose permitting requirements have prompted technology giants to build in the Lone Star State.
But data centers use massive amounts of electricity, a resource Texas has struggled to generate. Baxtel estimates the supercomputers in Texas require about 8.3 gigawatts of electricity, accounting for nearly 10 percent of peak demand.
“The amount of energy it takes to run an AI Google search is between 10 and 30 times the power requirement to do a traditional Google search,” ERCOT CEO Pablo Vegas told lawmakers last summer.
In 2024, the grid operator boosted its five-year electricity demand forecast to 150 gigawatts. In 2023, the projected five-year demand hovered around 110 gigawatts.
Regulators attributed the growth, partly, to the tech industry’s boom.
“They have to produce a lot of electricity and we’ll make it possible for them to get that production done very easily at their own plants if they want,” Trump said during the announcement Tuesday.
The money Stargate promises to invest could be used to build power plants that are attached to data centers, producing electricity for the supercomputers so they are nearly self-sustaining.
Trump promised to speed construction of such infrastructure projects by cutting red tape.
Texas lawmakers are pushing data centers and cryptocurrency miners to invest in small modular reactors, nuclear power generators that are smaller, cheaper and easier to maintain than existing reactors.
“These companies will invest in building the capacity to generate so they won’t just be consumers of the grid, but they’ll also generate power to put back on the grid,” Chilson said.
Stargate has not yet detailed future construction plans.