OpenAI, SoftBank Invest $1B in SB Energy for AI Data Centers

OpenAI–SoftBank: A $1 Billion Bet on the Future of AI Power

OpenAI and SoftBank have each committed $500 million to SB Energy, SoftBank’s energy and infrastructure subsidiary, in a transaction totaling $1 billion. The investment is intended to support the expansion of energy and data center infrastructure required for large-scale artificial intelligence computing.

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The funding reflects the growing importance of physical infrastructure—particularly energy supply and data center capacity—in supporting advanced AI systems. As AI models increase in size and complexity, their computing and power requirements continue to rise, placing greater emphasis on long-term infrastructure planning.

Stargate and Infrastructure Development

The investment is linked to OpenAI’s Stargate initiative, an AI infrastructure platform designed to support future model training and deployment at scale. Under the partnership, SB Energy will work with OpenAI on the development of data centers and associated power systems intended to meet these requirements.

The collaboration focuses on aligning energy generation, grid connectivity, and data center construction to ensure reliable power supply for high-density computing environments. This approach aims to address operational constraints that can arise when energy and computing infrastructure are developed separately.

Milam County Data Center Project

A central element of the partnership is a planned 1.2-gigawatt data center facility in Milam County, Texas, which SB Energy has been selected to build and operate for OpenAI. Facilities of this scale are designed to support large clusters of computing hardware used for AI model training and inference.

According to project disclosures, construction is expected to generate significant local employment during the build phase, with longer-term operational roles following completion. The facility is intended to become a key component of OpenAI’s broader infrastructure footprint.

Standardized Data Center Development Model

Beyond the Texas project, OpenAI, SoftBank, and SB Energy have established a preferred partnership framework aimed at streamlining future data center development. The goal is to create repeatable design and construction standards that can be deployed across multiple locations as AI infrastructure demand grows.

By standardizing layouts, power systems, and cooling designs, the partners aim to reduce development timelines and improve operational efficiency. This approach reflects a broader industry trend toward modular and scalable infrastructure models for large computing workloads.

Financing and Expansion Pipeline

In addition to the $1 billion investment from OpenAI and SoftBank, SB Energy has secured $800 million in redeemable preferred equity from Ares. The combined financing is intended to support the development of multiple data center campuses with multi-gigawatt capacity.

SB Energy has indicated that several projects are already in development, with initial facilities expected to enter service within the year. These sites are designed to support sustained, high-power computing operations rather than short-term or experimental workloads.

Broader Industry Context

The investment highlights a structural shift in the AI sector, where access to reliable energy and large-scale data center capacity is becoming as strategically important as model development itself. As competition among AI developers intensifies, infrastructure constraints are increasingly shaping deployment timelines and operating costs.

Rather than focusing solely on software innovation, leading AI organizations are expanding their involvement across the full infrastructure stack, including energy sourcing, land acquisition, and long-term facility planning. This trend suggests that future AI competitiveness will depend not only on algorithms, but also on the ability to secure and operate industrial-scale computing environments.

https://www.wsj.com/tech/ai/openai-softbank-to-invest-1-billion-in-sb-energy-fa7385b9