The Global AI Infrastructure Investment Partnership has been launched to develop data centers and energy projects, addressing the growing demands of the artificial intelligence (AI) sector.

Larry Fink, CEO of BlackRock, highlighted the multi-trillion dollar need for global data center expansion to support AI, emphasizing that these investments are crucial for economic growth and job creation.

The partnership aims to leverage investments up to $100 billion over time, reflecting the significant capital required to meet the energy and processing power needs of the AI boom.

As the industry faces pressure to decarbonize and achieve 24/7 carbon-free energy usage by 2030, there is a growing demand for clean power aligned with corporate sustainability goals.

In the U.S., power generation growth has been slow, underscoring the need for accelerated development of renewable energy sources to support these initiatives.

Vacancy rates in key data center markets, such as Northern Virginia, are at historic lows, complicating interconnection and grid access for new developments.

Investors are increasingly looking at enhancing power access and sources, as well as addressing the labor shortage in the data center industry, which could impede growth.

Lead times for powering new data centers in major markets can exceed three years, adding complexity to the development process.

The initiative is expected to advance technology while boosting competitiveness, security, and economic prosperity across various sectors.

Microsoft's CEO, Satya Nadella, emphasized the partnership's commitment to advancing innovation and sustainable growth, with a vision for AI to enhance productivity across the economy.

Despite the announcement of this partnership, Microsoft's stock saw a minimal increase of 0.3% in pre-market trading, indicating cautious investor sentiment.

In a related move, BlackRock is acquiring Global Infrastructure Partners for $3 billion in cash and shares, with the transaction expected to close on October 1, 2024.