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(Bloomberg) — Alphabet Inc.’s Google plans to invest $40 billion in three new Texas data centers, ramping up its footprint as competitors such as OpenAI and Anthropic PBC map out their own multibillion-dollar bets in the state.
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The investment will be made through 2027, Google said in a statement Friday. One data center will be in Armstrong County, in the Texas panhandle, and two in Haskell County, a stretch of West Texas near Abilene. One of the Haskell facilities will be co-located with a new solar and battery energy storage plant designed to ease the impact on the power grid.
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“This investment will create thousands of jobs, provide skills training to college students and electrical apprentices, and accelerate energy affordability initiatives throughout Texas,” Alphabet Chief Executive Officer Sundar Pichai said at an event near Dallas, where the company already has two data center locations.
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Texas is home to some of the largest data center initiatives under development, riding a surge in demand for computing spurred by the artificial intelligence boom. Earlier this week, Anthropic announced that it will invest $50 billion in data centers across the US, including in New York and Texas, which has an abundance of land and relatively cheap energy.
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The first data center being built by the Stargate venture backed by ChatGPT creator OpenAI, Oracle Corp. and Softbank Group Corp. is in Abilene, Texas, and executives have telegraphed they’ll locate more in the state.
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Meta Platforms Inc. is also building a new gigawatt-sized data center in Texas. For reference, a gigawatt of electricity can power 750,000 homes at any given moment. Microsoft Corp. inked a nearly $10 billion deal earlier this month for five years’ worth of computing capacity in Texas.
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Fermi Inc. — the real estate investment trust co-founded by former Texas Governor Rick Perry, who also served as energy secretary during President Donald Trump’s first term — has plans to build four nuclear-power reactors in the state for a private data-center campus.
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Multibillion-dollar spending pledges are commonplace for Google, which is expected to drop more than $90 billion on capital expenditures this year alone — a significant rise from earlier estimates, with the bulk going into servers, custom chips and new data centers to support its AI and cloud businesses.
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Just in the past two months, the company has announced a $15 billion plan to build an AI infrastructure hub in southern India; pledged to invest $6.4 billion in computing resources and operations in Germany; and committed to spending more than $6.5 billion in the UK to help spur more AI development.
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The spending spree underscores Alphabet’s ambition to scale globally and move beyond its legacy search advertising business, while testing how quickly the company can turn its heavy AI infrastructure spending into returns demanded by investors.
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