BlackRock has joined forces with Microsoft to launch what will initially be a $30 billion investment fund to finance AI infrastructure — concentrating primarily on building data centers and developing energy projects. The amount could quickly scale to about $100 billion. Abu Dhabi-based tech investment firm MGX is also participating, as is Global Infrastructure Partners (GIP), which owns, operates and invests across energy, transport, digital and waste management. BlackRock announced it is in the process of acquiring GIP, and says a deal expected to close next month. The new fund is called Global AI Infrastructure Investment Partnership (GAIIP).

The idea is to help “deliver generative AI products like ChatGPT (and beyond) to hundreds of millions of people around the world,” a push that “involves building more AI-accelerating chips, more data centers, and even new nuclear plants to power those data centers, in some cases,” reports Ars Technica.

“The capital spending needed for AI infrastructure and the new energy to power it goes beyond what any single company or government can finance,” Microsoft President and Vice Chairman Brad Smith said in an announcement. “This financial partnership will not only help advance technology, but enhance national competitiveness, security, and economic prosperity.”

“This partnership will support an open architecture and broad ecosystem, providing full access on a non-exclusive basis for a diverse range of partners and companies,” according to last week’s news release for the launch of GAIIP.

“Nvidia will support GAIIP, offering its expertise in AI data centers and AI factories to benefit the AI ecosystem. GAIIP will also actively engage with industry leaders to help enhance AI supply chains and energy sourcing for the benefit of its customers and the industry. “

The initial $30 billion is being sought from private equity, “which in turn will mobilize up to $100 billion in total investment potential when including debt financing,” the GAIIP announcement adds.

Microsoft’s investment “comes on top of the capital expenditures needed to support infrastructure expansion for its Azure public cloud, which supplies OpenAI and other AI customers,” CNBC writes.

“Tech companies have been racing to build data centers full of Nvidia graphics processing units, or GPUs, that can run generative AI models,” CNBC notes, explaining that “those GPUs consume serious power, and soaring demand has created a bottleneck for standing up new facilities.”

Ars Technica observes that the AI sector has faced criticism for its power consumption, and goes on to quote BlackRock CEO Larry Fink countering that “data centers are the bedrock of the digital economy,” powering economic growth, creating jobs and driving innovation.