Eric Schmidt Enters AI Data Center Arena with Texas Railroad Turned Oil Giant

Eric Schmidt, the former CEO of Google, is making significant strides in the AI and data center industry with his new startup, Bolt Data & Energy. The company is focusing its efforts in rural West Texas, utilizing an extensive land holding from Texas Pacific Land (TPL). This move aims to create enough energy to power approximately 7 million homes.

Innovative Approach to Data Centers

Bolt Data & Energy offers a comprehensive solution for hyperscalers by addressing their requirements for land, power, and water. The startup has partnered with TPL, which manages over 882,000 acres of land in West Texas, significantly larger than the state of Rhode Island. This land is not only rich in natural gas but also has access to renewable energy resources and water services critical for data center operations.

• Land Area: 882,000 acres in West Texas
• Power Capacity Goal: 10 gigawatts, enough for 7 million homes
• Initial Capital Raised: $150 million, with TPL investing $50 million

Mission and Future Plans

Schmidt emphasized the vital need for energy solutions in the AI sector. “Energy is the main constraint in scaling AI,” he stated. The collaboration with TPL aims to combine land and energy resources, promoting a future where data centers use a mix of natural gas and renewable energy sources.

Bolt’s vision aligns with Schmidt’s broader perspective on the AI landscape, which he describes as the “Fourth Industrial Revolution.” By fostering infrastructure that supports sustainable and responsible AI development, the startup is poised to enhance American competitiveness in the global market.

The Legacy of Texas Pacific Land

Texas Pacific Land has a storied history, originating from a failed railroad initiative in 1871. Although the railroad did not succeed, the land acquired has since become valuable due to the oil boom in the Permian Basin. TPL transitioned from a passive land trust to an active corporation in 2021, setting the stage for its new ventures in the AI and energy sectors.

Market Dynamics and Future Projects

As traditional data center hubs become saturated, regions like West Texas are increasingly appealing. The sparse population and favorable regulatory frameworks present an opportunity for large-scale data center projects. TPL’s CEO, Ty Glover, indicated that they aim to initiate construction on new projects within the next couple of years.

Schmidt plans to onboard one anchor customer, with potential partners including tech giants like Google and Microsoft. The strategy is to initially leverage natural gas power before expanding to a broader mix, including wind, solar, battery, and nuclear energy in the long run.

Conclusion

Bolt Data & Energy represents a pivotal venture at the intersection of energy, data, and AI. By utilizing extensive resources from Texas Pacific Land, Eric Schmidt aims to redefine how data centers operate, paving the way for scalable and sustainable solutions in the rapidly evolving AI landscape.