KKR and ECP's $50B AI Infrastructure Play

Published:
Random Notes
by Ernest Chiang

Post Title Image (Illustration: KKR HQ locates at 30 hudson yards in New York. Image source: Photo by Illya Goloborodko.)

✳️ tl;dr

  • News tracking 2024-10-30 1 → 2025-07-30 2
  • KKR is no stranger to the tech industry, having acquired an 80% stake in Philips’ semiconductor division in 2006, which was later renamed NXP Semiconductors. This was a client Ernest once served, leaving a particularly deep impression.
  • 【2024-10-30】KKR and Energy Capital Partners announced a $50 billion strategic partnership focused on accelerating data center, power generation, and transmission infrastructure development to support global AI and cloud computing expansion 1
  • The partnership combines over 8GW of existing data center pipeline and 100GW of operating and development-ready power generation capacity, with KKR owning over 100 data center facilities worldwide 1
  • ECP invests in clean energy asset base, owning and operating over 83GW of power generation capacity in the U.S. market, spanning five asset classes including power generation, renewables, and storage 1
  • The partnership aims to collaborate with utilities, power producers, and data center developers to rapidly and responsibly develop large data center campuses for hyperscalers 1
  • Context: BlackRock launched a $30 billion AI infrastructure fund in the same month, backed by Microsoft and Nvidia, demonstrating capital’s rush into AI infrastructure 1
  • 【2025-07-30】First investment lands: 190MW hyperscale data center campus in Bosque County, Texas, marking 9 months from strategic announcement to first project announcement 2
  • Innovative co-location model: Data center adjacent to Calpine’s Thad Hill Energy Center natural gas power plant, representing the first such dedicated power agreement with a hyperscaler 2
  • Constructed through a joint venture between CyrusOne and ECP, expected to be operational in Q4 2026, with total investment approaching $4 billion, initial IT capacity of 144MW, spanning over 700,000 square feet 2
  • Behind-the-Meter model: Calpine provides 190MW of dedicated power, which can be redirected to support system reliability and local demand during ERCOT grid emergencies 2
  • AI-driven power demand: Goldman Sachs predicts global data center power demand will grow 165% by 2030 compared to 2023, with AI data center power density surging from traditional 5-10kW/rack to 50-200kW/rack 34
  • Grid bottleneck severity: New data center grid connection delays have reached 5 years, while Behind-the-Meter natural gas generation can be deployed within 18-24 months, becoming a pragmatic choice 5
  • Texas regulatory environment: SB6 new legislation (signed June 2025) requires large loads over 75MW to bear grid costs, accept emergency curtailment, and install ERCOT-controlled “kill switches” 67
  • Private equity continues to double down: 2024 data center investment reached $108 billion (triple that of 2023), with KKR's 2021 acquisition of CyrusOne for $15 billion laying the foundation for this partnership 89

✳️ Knowledge Graph

(More about Knowledge Graph…)

%%{init: {'theme':'default'}}%%
graph LR
    KKR[KKR]:::instance
    ECP[ECP]:::instance
    CyrusOne[CyrusOne]:::instance
    Calpine[Calpine]:::instance
    Campus[Bosque County Campus]:::instance
    ThadHill[Thad Hill Energy Center]:::instance
    ERCOT[ERCOT]:::instance
    Hyperscalers[Hyperscalers]:::instance
    
    Partnership[Strategic Partnership]:::concept
    DataCenter[Data Center Infrastructure]:::concept
    PowerGen[Power Generation]:::concept
    AIInfra[AI Infrastructure]:::concept
    Sustainability[Sustainability Initiatives]:::concept
    DedicatedPower[Dedicated Power Agreement]:::concept
    Colocation[Colocation Model]:::concept
    GridStability[Grid Stability]:::concept
    NaturalGas[Natural Gas Generation]:::concept
    
    KKR -->|forms| Partnership
    ECP -->|forms| Partnership
    Partnership -->|invests 50 billion| AIInfra
    Partnership -->|develops| DataCenter
    Partnership -->|secures| PowerGen
    
    KKR -->|joint venture with| CyrusOne
    ECP -->|joint venture with| CyrusOne
    CyrusOne -->|constructs| Campus
    
    Campus -->|implements| Colocation
    Campus -->|requires| DedicatedPower
    Campus -->|delivers| AIInfra
    Campus -->|features| Sustainability
    
    Calpine -->|operates| ThadHill
    Calpine -->|signs| DedicatedPower
    ThadHill -->|provides| NaturalGas
    ThadHill -->|co-locates with| Campus
    NaturalGas -->|powers| Campus
    
    Campus -->|serves| Hyperscalers
    Hyperscalers -->|anchor| DedicatedPower
    
    NaturalGas -->|supports| GridStability
    Campus -->|responds to| ERCOT
    ERCOT -->|manages| GridStability
    GridStability -->|enables| PowerGen
    
    Sustainability -->|includes| WaterConservation[Water Conservation]:::concept
    Sustainability -->|includes| ClimateNeutral[Climate Neutral]:::concept
    Sustainability -->|includes| Biodiversity[Biodiversity Protection]:::concept
    
    classDef concept fill:#FF8000,stroke:#CC6600,stroke-width:2px,color:#000
    classDef instance fill:#0080FF,stroke:#0066CC,stroke-width:2px,color:#fff

%%{init: {'theme':'default'}}%%
sequenceDiagram
    participant KKR
    participant ECP
    participant CyrusOne
    participant Calpine
    participant Hyperscalers
    
    Note over KKR,ECP: October 2024
    KKR->>ECP: Form 50 billion partnership
    ECP->>KKR: Combine power and data expertise
    
    Note over KKR,Hyperscalers: Q4 2024 - Q1 2025
    KKR->>CyrusOne: Establish joint venture
    ECP->>CyrusOne: Co-develop campus
    ECP->>Calpine: Negotiate power agreement
    Calpine->>ECP: Sign long-term contract
    
    Note over KKR,Hyperscalers: January 2025
    CyrusOne->>Calpine: Begin construction
    Hyperscalers->>CyrusOne: Anchor tenant commitment
    
    Note over KKR,Hyperscalers: Q4 2026
    CyrusOne->>Hyperscalers: Campus operational
    Calpine->>CyrusOne: Deliver dedicated power

%%{init: {'theme':'default'}}%%
classDiagram
    class StrategicPartnership {
        +capital: 50 billion USD
        +focus: AI Infrastructure
        +deploy()
        +integrate()
    }
    
    class KKR {
        +facilities: 100+ worldwide
        +datacenters: 8GW pipeline
        +invest()
        +acquire()
    }
    
    class ECP {
        +generation: 83GW owned
        +capacity: 100GW development
        +operate()
        +develop()
    }
    
    class JointVenture {
        +location: Bosque County
        +investment: 4 billion USD
        +construct()
        +operate()
    }
    
    class CyrusOne {
        +area: 700000 sqft
        +capacity: 144MW initial
        +develop()
        +manage()
    }
    
    class Calpine {
        +facility: Thad Hill Center
        +power: 190MW dedicated
        +generate()
        +supply()
    }
    
    class DataCenterCampus {
        +capacity: 190MW
        +operational: Q4 2026
        +type: Hyperscale
        +compute()
        +scale()
    }
    
    StrategicPartnership <|-- KKR
    StrategicPartnership <|-- ECP
    KKR --> JointVenture: funds
    ECP --> JointVenture: funds
    JointVenture <|-- CyrusOne
    JointVenture --> DataCenterCampus: develops
    Calpine --> DataCenterCampus: powers

%%{init: {'theme':'default'}}%%
gantt
    title Project Development Timeline
    dateFormat YYYY-MM-DD
    
    section Partnership Formation
    Partnership Announcement: done, partnership, 2024-10-30, 1d
    Capital Commitment: done, capital, 2024-10-30, 90d
    
    section Site Development
    Site Selection: done, site, 2024-11-01, 60d
    Joint Venture Formation: done, jv, 2025-01-01, 30d
    Project Announcement: done, announce, 2025-01-30, 1d
    
    section Construction Phase
    Site Preparation: active, prep, 2025-02-01, 90d
    Foundation Work: foundation, 2025-05-01, 120d
    Building Construction: building, 2025-09-01, 270d
    
    section Power Infrastructure
    Power Agreement Execution: done, power, 2025-01-15, 15d
    Grid Integration Planning: grid, 2025-02-01, 180d
    Power System Installation: powersys, 2025-08-01, 240d
    
    section Commissioning
    Equipment Installation: equipment, 2026-06-01, 120d
    Testing and Validation: testing, 2026-10-01, 60d
    Operational Readiness: milestone, operational, 2026-12-01, 1d

✳️ Further Reading

  1. https://www.datacenterdynamics.com/en/news/kkr-signs-50bn-partnership-with-ecp-for-data-center-and-power-development/ ↩︎ ↩︎ ↩︎ ↩︎ ↩︎ ↩︎

  2. https://www.businesswire.com/news/home/20250730057911/en/ ↩︎ ↩︎ ↩︎ ↩︎ ↩︎

  3. https://www.goldmansachs.com/insights/articles/ai-to-drive-165-increase-in-data-center-power-demand-by-2030 ↩︎

  4. https://www.aflhyperscale.com/articles/physical-requirements-for-ai-data-centers/ ↩︎

  5. https://heatmap.news/energy/natural-gas-data-centers-speed ↩︎

  6. https://www.utilitydive.com/news/texas-law-gives-grid-operator-power-to-disconnect-data-centers-during-crisi/751587/ ↩︎

  7. https://www.pillsburylaw.com/en/news-and-insights/texas-sb6-transmission-fees-interconnected-standards-large-load-customers-colocated-loads.html ↩︎

  8. https://blog.se.com/datacenter/2025/01/23/unlocking-data-center-ecosystems-the-power-of-private-equity/ ↩︎

  9. https://stlpartners.com/articles/data-centres/top-data-centre-investors-2025/ ↩︎