Oracle is taking a billion-dollar bet on artificial intelligence infrastructure that could transform the way the tech titans fuel their data centres. To wait years to connect to the traditional grid, however, would run into billions of dollars, so the database innovator intends to spend more than a billion dollars a year to run a large facility in Texas on gas generators. This is unprecedented, but it also shows how there is an urgent race to meet thriving AI computing requirements.
The enormous investment by Oracle in the AI infrastructures in West Texas
Oracle is building one of the largest data centers across the world in Shackelford County, Texas, in partnership with Vantage Data Centers. As per Interesting Engineering, the new campus, dubbed the Frontier, will cover an area of 1,200 acres, including 10 data centers of 3.7 million sq ft of space that have an amount of 1.4 gigawatts.
The facility is equipped to handle ultra-high-density racks of 250 kilowatts and above, powered by liquid cooling, addressing next-generation GPU workloads to address AI computing needs. It is already starting to be built, and the first building should be operational in the second half of 2026.
Such is the bypass of the grid connection delay when using gas generators
Bloomberg notes that Oracle will even spend over a billion dollars to run this megasite based on gas generators instead of waiting until they are connected to the utilities. Releasing the company to attach such large centers with local power systems may take years, necessitating the need to move the company into gas power.
AI cloud superstar to database visionary
Oracle was established in the year 1977 and has since transformed itself to be an industry-leading provider of cloud services over the last ten years. Its current targets are centered on the area of AI computing, which it has made its main growth segment based on the fact that it has adopted the so-called bare metal approach, i.e., customers have their own machines, not others.
A game changer was when TikTok shifted its U.S load to Oracle servers, which earned the company over a billion dollars every year by 2022. It is also supplying Elon Musk’s xAI with Utah-based data centers and is creating clusters of tens of thousands of AI microchips in Nvidia.
How major deals transformed Oracle’s market position
Recently, Oracle entered into what is referred to as the largest single cloud deal ever with OpenAI regarding the Stargate project. OpenAI has partnered with Oracle to develop approximately 4.5 gigawatts of data center power that would serve enough households or people as 3.4 million.
Green issues and market rivalry
The choice of gas-powered turbines causes considerable environmental concerns, since such plants can induce rather huge air pollution. Even the xAI supercomputer built in Memphis using methane turbines has already attracted criticism as a major source of air pollution in the area.
Other high-tech executives are investigating alternative ways to generate power for large computing centers. Nuclear energy has gained interest among Google, Microsoft, and Meta, whose data centers have invested in nuclear energy as a form of clean energy that will be used in the long term despite the associated risks.
The billion-dollar investment by Oracle in a gas-powered data center signifies a radical change that technology companies are putting across when it comes to infrastructure development. The choice to avoid the use of conventional grid connections by using costly gas generation describes the extreme urgency behind AI infrastructure investments. Although the problem of environmental change remains important, the paradigm of the Oracle company shows that the need to address the challenges of AI computing has become a priority, even at the expense of substantial costs in money and the environment.