Japan’s power, Wall Street’s compute: Apollo backs $15B AI build beside JERA gas plant
- JERA, Dell and RHAELM signed an MoU to build a standardized AI data center model in Japan.
- The hyperscale site will sit beside JERA’s Chiba power plant, with Apollo as financing partner.
- JERA is set to supply power to the facility under a 15- to 25-year power deal.
Japan’s largest power generator, JERA, has agreed to build a hyperscale AI data center next to one of its gas-fired plants in Chiba.
The project is expected to cost more than $15 billion and draw financing from Apollo Global Management, becoming the latest mega data center project funded by outside capital.
Digital Minister Hisashi Matsumoto warned earlier in the year that Japan needs to snap out of its slumber and close the early lead that the US and China have built in computing to avoid becoming an “AI colony.”
What is JERA building?
A three-way deal between JERA, Dell Technologies and UK developer RHAELM has been announced today, Thursday.
The partners signed a memorandum of understanding to create a standardized template for building AI infrastructure across Japan, starting at JERA’s Chiba Thermal Power Station.
Apollo intends to act as RHAELM’s strategic investment and financing partner on that first site.
The reason the project will be built next to an existing thermal plant comes down to electricity and how long it takes to get.
In Tokyo, new grid connections can take five to 10 years, a wait that has repeatedly stalled data center projects even after the money is committed. International hyperscalers including AWS, Microsoft and Oracle have responded by spreading capacity across multiple regions to find power the Tokyo grid cannot supply.
JERA says the Chiba facility will draw power directly from the plant rather than waiting on a grid hookup. Operations are targeted to begin in phases around 2028. The data center is expected to reach full capacity in 2029, with JERA supplying power under a contract running 15 to 25 years.
The company says it generates roughly a third of Japan’s power and provides nearly all the electricity consumed in Greater Tokyo.
RHAELM will develop, build, operate and finance the data center itself while Dell Technologies will contribute its AI hardware.
The site is sized for up to 400 megawatts. At that scale, JERA says, it would be the largest single-site AI deployment in Japan and one of the biggest in Asia.
How long will JERA provide electricity for the Chiba facility?
JERA’s 15- to 25-year power deal fixes the single largest running cost when it comes to building data centers. The deal also hands JERA a guaranteed buyer for years.
If the Chiba facility is completed smoothly, JERA and RHAELM say they want to replicate the data center at other JERA sites. The companies have an ambition of providing multi-gigawatt AI capacity across Japan by the 2030s.
Their initiative is in line with Tokyo’s “Watt-Bit Collaboration,” which is intended to coordinate power and digital infrastructure.
“JERA is uniquely positioned to power Japan’s AI ambitions,” Global CEO and Chair Yukio Kani said in the company’s statement, pointing out the company’s reach across the LNG value chain.
Japan’s AI colony headache
Notably, Blackstone President Jonathan Gray said in June that the firm plans to invest $30 billion in Japanese AI data centers over three to five years. Apollo’s role at the Chiba facility adds another large U.S. investor to the list of companies expanding into Japan.
Also in June, Cryptopolitan reported that Japan’s Digital Minister Hisashi Matsumoto warned that the country risks becoming an “AI colony” if it cannot close its computing gap with the US and China.
Don’t just read crypto news. Understand it. Subscribe to our newsletter. It's free.
FAQs
Who is investing in the Chiba AI data center?
JERA is providing the land and power, Dell supplies the AI hardware, and UK-based RHAELM develops and operates the facility, with Apollo Global Management intending to serve as RHAELM's strategic investment and financing partner.
How big is the project and when will it open?
The Chiba site is sized for up to 400 MW and total capital deployment is expected to exceed $15 billion across all phases; operations are targeted to begin in phases in 2028 and reach full capacity in 2029.
Why build the data center next to a power plant?
Tokyo grid connections can take five to 10 years, so the center will run behind-the-meter directly from JERA's existing plant, which JERA says lets computing capacity come online years ahead of a conventional grid-connected schedule.
Disclaimer. The information provided is not trading advice. Cryptopolitan.com holds no liability for any investments made based on the information provided on this page. We strongly recommend independent research and/or consultation with a qualified professional before making any investment decisions.
Hannah Collymore
Hannah is a writer and editor with nearly a decade of blog writing and event reporting experience in the crypto space. At Cryptopolitan, Hannah contributes to the news page, reporting and analyzing the latest developments in DeFi, RWA, crypto regulation, AI and frontier tech industries. She graduated from Arcadia university with a degree in Business Administration.
