Nvidia will allocate up to $105 billion for an OpenAI data center. Is there a risk of circular schemes?
Nvidia Will Allocate Up to $105 Billion for OpenAI's Data Center / Photo: Robert Way / Shutterstock
Nvidia will provide up to $105 billion in financial support for the construction of a massive data center in Ohio, which OpenAI plans to lease, Bloomberg reports, citing company documents. Previously, as the agency reported, there had been discussions about providing guarantees of up to $250 billion, which would allow OpenAI to secure debt financing.
The developer of ChatGPT has signed an agreement to reserve approximately 8 GW of computing power at the complex, with the first 800 MW set to come online by 2028. One GW is enough to power up to 750,000 American homes, the agency explains.
Nvidia's financial support will initially cover 4.25 GW of capacity, with the option to increase it by an additional 3.75 GW. In addition, the chipmaker will invest $1.5 billion in SB Energy, whose investors include Japan’s SoftBank and OpenAI. SB Energy will build, own, and operate the facility.
What are the risks?
The data center in Ohio will be equipped with Nvidia chips and computing systems. Such agreements raise concerns about “circular schemes” in the industry, where a company effectively finances the buyers of its own processors. Nvidia has already provided financial support to other players rapidly expanding their AI infrastructure, most notably CoreWeave. In addition, it has invested directly in OpenAI and its competitor, Anthropic. And last week, together with six major asset managers, it launched financial platforms designed to raise $500 billion in third-party capital for data centers.
The company insists that the agreement with OpenAI regarding the project in Ohio does not involve any “circular schemes.” Nvidia is not financing the purchase of its own processors but will provide guarantees for a certain portion of the rent and electricity payments. The company will not guarantee financing for the entire complex or all of OpenAI’s lease obligations. “OpenAI will pay the rent,” said Nvidia CEO Jensen Huang.
This article was AI-translated and verified by a human editor
