FOR IMMEDIATE RELEASE: Mar. 4, 2025
CONTACT:
Jarice Thompson
jarice@ourfinancialsecurity.org
New Analysis Documents Record-Breaking Private Equity Investment in Data Centers
PE has spent nearly $200 billion since 2022 on projects that may burden local communities.
Washington, D.C– Americans for Financial Reform Education Fund published a research memo, Private Equity’s Silicon Gold Rush, analyzing private equity’s surging investments in data centers used for artificial intelligence, cryptocurrency mining, and cloud computing. The private equity industry has dominated acquisitions and investments in recent years to secure a powerful market position in the growing investments in artificial intelligence as well as the resurgent cryptomining industry, which has been buoyed by the administration’s close ties to and support for cryptocurrency.
The new analysis documents that private equity has been responsible for 80 to 90 percent of the total value of deals in this sector since 2022, and that the private equity industry has spent at least an estimated $170 billion acquiring or investing in over 450 data center companies in that time period. Because of the lack of transparency in the private equity industry, the real figure is likely to be higher still.
The surging private equity investment is intensifying the longstanding problems with data center operations — such as draining local water sources to cool servers, high and (often under-reported) carbon emissions, acoustic pollution, and increased costs and strain for local electricity ratepayers. In addition, data center projects often receive government subsidies, meaning state and local dollars — taxpayer money — can be supporting the data center investments by wealthy private equity firms.
“The private equity industry is spending a torrent of money in an exploding sector that is creating significant environmental and financial burdens on communities where these data centers are located,” said Dustin Duong, research associate at Americans for Financial Reform Education Fund. “The private equity industry is quietly setting up to reap financial rewards by consolidating a hold the data center market, but communities must reckon with the negative environmental, economic, and social impacts.”
In a handful of years, private equity firms have inked three of the largest data center deals in the sector’s history: Blackstone’s $15 billion takeover of AirTrunk, KKR’s $15 billion buyout of CyrusOne, and private equity firm IFM’s partnership with digital infrastructure asset manager to purchase Switch, Inc. A further gargantuan deal is yet to be finalized: a $50 billion joint venture between KKR and Energy Capital Partners to develop and power a fleet of data centers.
The power demand to feed surging data center capacity is slowing or reversing the transition to clean energy, restarting or maintaining shuttered coal power plants, and raising household utility rates.
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