AI’s power crisis has become so acute that Anthropic, a company that has generally avoided purchasing physical infrastructure, is spending $3.4 billion on natural gas turbines.
The AI company, which plans to go public this year, is buying Caterpillar generators that equipment supplier OnePWR originally ordered, according to a Financial Times report. The generators are capable of producing up to 1.7 gigawatts of electricity.
Historically, Anthropic has preferred to rent rather than buy. The company revealed in its S-1 filing in May that it would pay SpaceX subsidiary xAI $1.25 billion per month through May 2029 to use xAI’s computing power.
“We plan to enter into other similar service agreements,” Anthropic said in the filing, meaning more computing power leases.
But as demand for computing increases, the electricity market has also become increasingly uncertain, which may have forced its hand. The delay in developing natural gas turbines extends into the early 2030s, and the lines to connect to the power grid can be just as long.
Buying Anthropic feels like a last resort.
According to the report, OnePWR ordered the turbines a few years ago, but could not find the necessary financing to complete the purchase. Anthropic had planned to purchase them from OnePWR but went directly to Caterpillar, the manufacturer.
It is unclear why OnePWR was unable to secure funding despite Anthropic’s apparent interest as a client. Regardless, Anthropic probably wanted to keep the production capacity for itself rather than give a competitor the chance to take it over.
AI companies have increased their purchases of natural gas equipment and supplies in recent years. Google, Amazon, Microsoft and Meta have all announced plans to build massive natural gas power plants to power their on-site data centers, rather than tapping into the public grid.
This frenzy has given a second lease of life to hydraulic fracturing, the drilling method used to extract natural gas from underground rocks. And if development proceeds as planned, U.S. data centers alone could consume more natural gas than Germany and Japan combined by 2035. Dependence on natural gas also exposes hyperscalers to price fluctuations. One analyst expects prices could more than triple by the end of the decade in some markets. If that happens, Anthropic could have a serious case of buyer’s remorse.
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