- ADQ and Energy Capital Partners agree $25bn deal to increase power generation.
- The investment aims to meet growing energy demands of hyperscale cloud companies and data centres.
What happened: Investment deal signed
Abu Dhabi’s sovereign wealth fund, ADQ, and the American private equity firm, Energy Capital Partners (ECP), have signed a $25 billion investment deal. This agreement aims to enhance power generation. Both firms will invest equally to generate over 25 gigawatts of power. The goal is to meet the rising energy demands of hyperscale cloud companies, data centres, and other energy-intensive industries. This initiative is crucial as the digital infrastructure sector expands, driven by the growing adoption of AI and advanced technologies.
Mohamed Hassan Alsuwaidi, managing director and group CEO of ADQ, emphasised the opportunities arising from the rapid acceleration of AI. He stated, “Meeting these power needs poses challenges for governments worldwide. They must ensure a secure, stable, and commercially competitive electricity supply. Our partnership with ECP allows us to invest significantly in generation and related infrastructure assets. This supports the increasing demand for power and promotes the growth of these industries, helping to future-proof economies.”
Doug Kimmelman, ECP’s founder and executive chairman, highlighted the importance of new electricity supplies for economic growth and job creation in the US. He noted,“Given the tightening supply and demand dynamics in US power markets, new generation capacity is essential. Our focus in this partnership will be on building natural gas-fired power generation assets to meet the needs of hyperscalers promptly.”
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Why it is important
The partnership between ADQ and Energy Capital Partners is significant. It addresses the growing energy demands of the digital infrastructure sector. A recent report from the International Energy Agency (IEA) predicts that global electricity consumption will rise at its fastest rate in years. This increase is partly driven by the demands of data centres and industrial electrification. The investment deal aims to support the rapid growth of hyperscale cloud companies and data centres. These are crucial for developing and deploying AI technologies.
Focusing on new natural gas-fired power generation assets is vital, especially given the tightening supply and demand dynamics in US power markets. By investing in large-scale power generation, this partnership will help tackle the challenges of ensuring a secure, stable, and commercially competitive electricity supply. This investment is essential for the continued progress of industries that depend heavily on data centres and hyperscale cloud services.
