More than $500 million in funding is being directed toward enhancing next-generation data center infrastructure through a partnership between ArcLight Capital Partners and DigitalBridge Group, aimed at supporting Takanock, a burgeoning power infrastructure startup. This investment is particularly crucial in regions like Northern Virginia and Phoenix, where power limitations could hinder the growth of the digital economy.
Founded in 2023, Takanock is strategically focused on merging power and digital infrastructure. The company aims to tackle the critical issue of power availability for hyperscale data centers by designing and implementing scalable energy solutions to speed up deployment timelines, bypassing traditional utility delays. Leading the initiative is Kenneth Davies, a veteran in energy innovation who has previously worked with Google Energy and Microsoft’s global renewable energy strategy. He emphasizes that fusing energy and digital expertise is now essential, particularly as the demand for computing capacity increases.
Takanock’s innovative technology centers around adaptive on-site power generation, which serves as primary energy until established grid connections are operational. The company’s modular systems provide rapid deployment, unimpeded by the lengthy processes associated with establishing new substations or upgrading utility infrastructure. This approach offers flexibility and resilience in markets with limited grid capacity.
DigitalBridge, which manages over $80 billion in digital infrastructure assets, regards Takanock as a vital link between the energy and computing sectors. Senior Managing Director Jon Mauck notes that as power becomes crucial in digital operations, Takanock’s model offers operators a consistent solution in capacity-constrained areas.
Sustainability plays a central role in Takanock’s mission, with its technology supporting the use of renewable resources while bolstering grid flexibility. The systems incorporate advanced emission controls and closed-loop cooling to minimize environmental impacts, aligning with the environmental, social, and governance (ESG) standards important for hyperscale operators.
With ArcLight’s extensive experience in the utility sector, the firm recognizes the increasing unpredictability surrounding grid power costs and availability. Partner Jake Erhard comments that Takanock’s solutions are specifically crafted for current challenges, offering swift deployment and scalability aligned with sustainability goals.
Since early 2024, Takanock has made significant strides in acquiring strategic properties and initiating projects, particularly in critical markets like Phoenix and Northern Virginia. These long-term contracts underscore the validation of Takanock’s hybrid energy approach.
The financial consultancy for this significant investment has been managed by Houlihan Lokey, with Simpson Thacher & Bartlett serving as legal advisors for DigitalBridge.
In a landscape where power constraints are becoming more pronounced in global data infrastructure, Takanock’s hybrid model emerges as a timely solution, bolstered by seasoned investors and a team adept in both data and energy sectors, with the aim of addressing the key challenges in power availability for future cloud-scale growth.
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