Crusoe, a Denver-based startup specializing in AI data centers, has decided to terminate its plans to utilize a newly developed line of stationary power plants created by local company Boom Supersonic. This announcement follows Crusoe’s recent achievement of raising $3.9 billion in funding.
Established in 2018, Crusoe initially focused on bitcoin mining powered by excess natural gas from oil fields. Over the years, the company has evolved into one of the most significant builders of AI data centers, notably including a large facility in Abilene, Texas, which provides computing resources to OpenAI.
Boom Supersonic, renowned for developing the supersonic passenger jet named Overture, launched a new division last year aimed at selling a modified version of its aircraft engine for use in natural gas-fired stationary power plants. Their new Superpower turbine shares approximately 80% of its components with the aircraft engine known as Symphony.
Crusoe had previously committed to becoming the inaugural customer for Boom’s stationary power plants, with plans to invest $1.25 billion in 29 of Boom’s 42-megawatt turbines, with deliveries set to commence in 2027. However, according to Boom’s CEO Blake Scholl, this partnership has now been dissolved.
In a recent post on the platform X, Scholl congratulated Crusoe’s founders, Cully Cavness and Chase Lochmiller, on their successful fundraising. He announced that the two companies would no longer proceed with the turbine partnership but mentioned that Boom has other clients in the pipeline.
Scholl clarified, “The TL/DR is that turbines are no longer part of Crusoe’s near-term primary power mix at Abilene, so a launch partnership just didn’t make sense. Boom will be delivering about 250MW of Superpowers next year to other sites, and we’re targeting 1GW in 2028.” He expressed hope for future collaboration when turbines might become relevant to Crusoe’s energy strategy.
Crusoe has confirmed the cessation of its business dealings with Boom. Spokesperson Andrew Schmitt stated, “We build AI factories from the power up, and we’re bringing new campuses online across the country, powered by innovative energy sources. While Boom has been a great partner, the partnership isn’t the right fit today.”
Crusoe’s initial 1.2 gigawatt data center in Abilene, which was constructed for Oracle and OpenAI, primarily relies on grid power, with a gas-turbine power plant used solely for backup. Furthermore, the company is in the process of constructing a 900 megawatt data center for Microsoft, which will utilize on-site gas turbines.
The loss of a key launch customer represents a setback for Boom, which had previously raised $300 million to kickstart this new initiative. The intent was to channel profits from the stationary power plant business to support the development of Overture.
Scholl was unavailable for further comment at the time of publication, but updates are expected as the situation unfolds.
Editor’s Take
This unexpected shift signifies a pivotal moment for both Crusoe and Boom Supersonic. For Crusoe, the focus on flexible energy solutions may enhance its ability to adapt to evolving market demands. For Boom, losing a high-profile client could delay its ambitions in the stationary power market, underscoring the challenges faced by emerging technologies in finding a foothold.
Source: techcrunch.com
