WASHINGTON: US President Donald Trump on Tuesday announced private sector investments of up to $500 billion to fund artificial intelligence infrastructure.

OpenAI, SoftBank and Oracle are planning a Texas-based joint venture called Stargate, and have committed $100 billion initially and then up to $500 billion to Stargate over the next four years.

SoftBank CEO Masayoshi Son, OpenAI’s Sam Altman and Oracle’s Larry Ellison joined Trump at the White House for the launch.

The announcement on Trump’s second day in office follows the withdrawal of former President Joe Biden’s executive order on artificial intelligence, which was intended to reduce the risks artificial intelligence poses to consumers, workers and national security.

AI requires enormous computing power, pushing demand for specialized data centers that allow tech companies to connect thousands of chips together in clusters.

“They have to produce a lot of electricity, and we’re going to make it possible for them to do that production very easily in their own factories if they want to,” Trump said.

As U.S. power consumption rises from AI data centers and the electrification of buildings and transportation, about half of the country is at increased risk of power shortages in the next decade, the North American Electric Reliability Corporation said in December.

As a candidate in 2016, Trump promised to push a $1 trillion infrastructure bill through Congress, but failed to do so. He often spoke on the subject during his first term as president from 2017 to 2021, but never delivered a major investment, and “Infrastructure Week” became a punchline.

Oracle shares rose 7% on the first report of the project earlier in the day. Nvidia, Arm Holdings and Dell shares also rose.

It was not immediately clear whether the announcement was an update on a previously reported venture.

In March 2024 The informationa technology news website, reported that OpenAI and Microsoft were working on plans for a $100 billion data center project that would include an artificial intelligence supercomputer also called “Stargate” to launch in 2028.

Investments in artificial intelligence have increased since OpenAI launched ChatGPT in 2022, as companies across sectors seek to integrate artificial intelligence into their products and services.