Anthropic joins AI’s natural gas frenzy, buys $3.4B turbines
Anthropic is spending $3.4 billion on Caterpillar natural gas turbines with 1.7 gigawatts of capacity to tackle the AI power crunch.
Stock photo for illustration only, not from the actual event
- Anthropic is spending $3.4 billion to buy natural gas turbines from Caterpillar
- The generators are capable of producing up to 1.7 gigawatts of electricity
- The company historically preferred renting computing infrastructure over buying
- Power backlogs for turbines and electrical grids stretch into the early 2030s
The artificial intelligence power crunch has grown severe enough to push Anthropic, a company that typically steers clear of purchasing physical infrastructure, into spending $3.4 billion on natural gas turbines.
According to a Financial Times report, the AI firm planning to go public this year is buying Caterpillar generators originally ordered by equipment supplier OnePWR. These generators possess the capacity to generate up to 1.7 gigawatts of electricity.
Stock photo for illustration only, not from the actual event
Historically, Anthropic has favored renting assets rather than owning them outright. In its May S-1 filing, the company disclosed it pays SpaceX subsidiary xAI $1.25 billion per month through May 2029 to utilize computing power.
"We expect to enter into additional similar services contracts"
Anthropic
However, as compute demand accelerates, the power market has grown increasingly uncertain, likely forcing the company's hand. Backlogs for natural gas turbines extend into the early 2030s, matching long wait times to connect to the electrical grid.
Anthropic’s acquisition appears to be a last resort measure. OnePWR originally ordered the turbines a couple of years prior but failed to secure financing. Although Anthropic initially planned to buy through OnePWR, it bypassed the supplier to deal directly with manufacturer Caterpillar, ensuring competitors could not snap up the generating capacity.
Anthropic's move underscores a critical turning point where leading AI developers realize electrical power is the ultimate bottleneck for scaling artificial intelligence. Constructing dedicated natural gas power plants on-site for data centers mitigates reliance on public grids, though it exposes tech giants directly to fossil fuel price volatility in global markets.
This rush mirrors broader trends among tech giants like Google, Amazon, Microsoft, and Meta, which have all announced plans to build massive on-site natural gas power plants for their data centers. This binge has revitalized fracking, with analysts projecting that U.S. data centers alone could consume more natural gas than Germany and Japan combined by 2035.
Source: TechCrunch
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