WEBVTT

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<v Sarah>Equinix wants three billion in bonds — with five to seven billion a year in capex planned through 2029.

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<v Sarah>You can already feel the gap.

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<v Matt>This is The Data Center Daily.

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<v Matt>Today — REITs raiding the bond market while NextEra quietly pencils in 8 gigawatts of new load.

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<v Sarah>Plus, a Digital Realty rent number that says small leases are pricing very differently from bulk compute. First up — Equinix.

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<v Sarah>Crypto <00:00:31.101>Briefing <00:00:31.528>writes:

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<v Quote>Equinix <00:00:33.194>wants <00:00:33.434>$3 <00:00:33.774>billion, <00:00:35.014>and <00:00:35.101>it’s <00:00:35.274>going <00:00:35.527>to <00:00:35.654>the <00:00:35.778>bond <00:00:36.080>market <00:00:36.381>to <00:00:36.494>get <00:00:36.727>it.

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<v Quote>The <00:00:37.611>global <00:00:38.034>data <00:00:38.388>center <00:00:38.665>operator <00:00:39.282>announced <00:00:39.781>plans <00:00:40.167>to <00:00:40.314>raise <00:00:40.567>at <00:00:40.714>least <00:00:40.954>$3B <00:00:42.224>through <00:00:42.474>a <00:00:42.647>US <00:00:42.950>investment-grade <00:00:43.698>bond <00:00:44.018>sale

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<v Quote>a <00:00:44.898>move <00:00:45.186>that <00:00:45.364>signals <00:00:45.794>just <00:00:46.154>how <00:00:46.323>aggressively <00:00:46.954>the <00:00:47.124>company <00:00:47.524>intends <00:00:47.901>to <00:00:48.007>build <00:00:48.314>out <00:00:48.482>infrastructure <00:00:49.194>for <00:00:49.354>the <00:00:49.634>AI <00:00:50.034>era.

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<v Sarah>Equinix <00:00:51.196>wants <00:00:51.449>at <00:00:51.596>least <00:00:51.849>three <00:00:52.196>billion <00:00:52.788>from <00:00:52.956>the <00:00:53.120>investment-grade <00:00:53.945>market.

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<v Sarah>That <00:00:55.036>money's <00:00:55.444>earmarked <00:00:55.916>for <00:00:56.132>land, <00:00:56.809>development, <00:00:57.516>and <00:00:57.769>AI-ready <00:00:58.427>capacity.

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<v Sarah>EQIX <00:01:00.596>up <00:01:00.836>3.92% <00:01:02.249>on <00:01:02.376>the <00:01:02.616>day — <00:01:03.518>the <00:01:03.661>market <00:01:03.858>clearly <00:01:04.326>read <00:01:04.566>this <00:01:04.811>as <00:01:04.985>build-out, <00:01:05.698>not <00:01:05.958>bail-out.

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<v Matt>And <00:01:07.638>they <00:01:07.918>lined <00:01:08.171>up <00:01:08.318>a <00:01:08.438>new <00:01:08.747>senior <00:01:09.238>unsecured <00:01:09.860>revolver <00:01:10.430>alongside <00:01:11.158>it.

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<v Matt>Three <00:01:12.178>billion <00:01:12.625>in <00:01:12.771>bonds, <00:01:13.462>plus <00:01:13.758>a <00:01:13.851>fresh <00:01:14.164>credit <00:01:14.518>line.

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<v Matt>They've <00:01:15.598>got <00:01:15.738>the <00:01:15.865>pedal <00:01:16.251>on <00:01:16.378>the <00:01:16.505>floor.

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<v Sarah>The <00:01:17.938>use-of-proceeds <00:01:19.069>language <00:01:19.371>is <00:01:19.518>the <00:01:19.702>tell <00:01:19.998>for <00:01:20.225>me.

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<v Sarah>Property <00:01:21.373>acquisitions, <00:01:22.171>development, <00:01:23.211>AI-ready <00:01:23.854>expansion <00:01:24.415>across <00:01:24.918>270-plus <00:01:26.249>facilities <00:01:26.811>in <00:01:27.078>76 <00:01:27.798>markets.

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<v Sarah>That <00:01:29.128>capital's <00:01:29.618>chasing <00:01:30.058>the <00:01:30.198>Cisco-NVIDIA <00:01:31.278>“AI <00:01:31.778>Factory” <00:01:32.326>footprint <00:01:32.790>they <00:01:32.966>announced <00:01:33.430>back <00:01:33.611>in <00:01:33.814>June.

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<v Matt>“AI <00:01:35.818>Factory” — <00:01:37.147>NVIDIA's <00:01:37.702>turnkey <00:01:38.180>branding <00:01:38.718>for <00:01:38.918>space <00:01:39.358>you <00:01:39.558>rent <00:01:39.928>instead <00:01:40.305>of <00:01:40.420>building.

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<v Matt>Fine. <00:01:42.488>But <00:01:42.815>before <00:01:43.198>I <00:01:43.302>call <00:01:43.590>that <00:01:43.758>three <00:01:44.018>billion <00:01:44.486>well <00:01:44.758>spent, <00:01:45.758>I <00:01:45.830>want <00:01:45.985>to <00:01:46.086>know <00:01:46.318>how <00:01:46.486>much <00:01:46.736>contracted <00:01:47.385>power <00:01:47.789>actually <00:01:48.411>shows <00:01:48.731>up <00:01:48.891>to <00:01:49.065>energize <00:01:49.678>those <00:01:49.971>racks.

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<v Sarah>Hanz <00:01:51.680>Christensen, <00:01:52.406>writing <00:01:52.739>in <00:01:52.899>Watch <00:01:53.230>List <00:01:53.598>News:

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<v Quote>Equinix <00:01:55.407>(NASDAQ:EQIX) <00:01:57.778>raised <00:01:58.127>its <00:01:58.295>full-year <00:01:58.847>and <00:01:59.015>long-term <00:01:59.587>outlook <00:02:00.074>after <00:02:00.455>reporting <00:02:00.942>accelerating <00:02:01.655>recurring-revenue <00:02:02.544>growth

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<v Quote>record <00:02:03.660>interconnection <00:02:04.303>additions <00:02:04.907>and <00:02:05.264>strong <00:02:05.651>bookings <00:02:06.034>in <00:02:06.107>the <00:02:06.213>second <00:02:06.537>quarter

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<v Quote>as <00:02:07.547>the <00:02:07.657>company <00:02:08.055>said <00:02:08.407>AI-related <00:02:09.255>infrastructure <00:02:09.984>demand <00:02:10.460>is <00:02:10.794>broadening <00:02:11.424>across <00:02:11.818>enterprise <00:02:12.383>customers <00:02:12.927>and <00:02:13.097>service <00:02:13.511>providers.

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<v Sarah>We <00:02:14.661>just <00:02:14.893>covered <00:02:15.193>the <00:02:15.333>$3 <00:02:15.583>billion <00:02:16.277>bond <00:02:16.600>raise.

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<v Sarah>Now <00:02:17.701>look <00:02:17.920>at <00:02:18.005>what <00:02:18.160>it <00:02:18.273>has <00:02:18.480>to <00:02:18.600>cover: <00:02:19.573>134 <00:02:20.673>megawatts <00:02:21.226>of <00:02:21.493>xScale <00:02:21.962>leases <00:02:22.430>closed <00:02:22.826>in <00:02:23.133>Q2

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<v Sarah>700 <00:02:24.753>megawatts <00:02:25.213>under <00:02:25.468>construction

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<v Sarah>and <00:02:26.793>capex <00:02:27.457>guidance <00:02:27.866>of <00:02:28.053>five <00:02:28.480>to <00:02:28.733>seven <00:02:28.983>billion <00:02:29.373>a <00:02:29.493>year <00:02:29.843>through <00:02:30.213>2029.

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<v Sarah>Do <00:02:32.253>the <00:02:32.446>arithmetic. <00:02:33.373>Three <00:02:34.023>billion <00:02:34.426>in <00:02:34.600>bonds <00:02:35.002>barely <00:02:35.470>covers <00:02:35.853>the <00:02:36.033>low <00:02:36.273>end <00:02:36.480>of <00:02:36.573>a <00:02:36.659>single <00:02:37.013>year.

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<v Matt>Right, <00:02:38.613>so <00:02:38.853>that <00:02:39.120>three <00:02:39.313>billion <00:02:39.813>is <00:02:40.013>a <00:02:40.117>down <00:02:40.443>payment.

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<v Matt>And <00:02:41.589>they're <00:02:41.843>sitting <00:02:42.133>on <00:02:42.373>3 <00:02:42.673>gigawatts <00:02:43.226>of <00:02:43.429>land <00:02:43.866>under <00:02:44.213>control.

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<v Matt>Land <00:02:45.833>you <00:02:45.933>don't <00:02:46.193>own <00:02:46.393>the <00:02:46.520>power <00:02:46.933>for <00:02:47.253>is <00:02:47.461>just <00:02:47.680>an <00:02:47.797>expensive <00:02:48.440>field, <00:02:48.906>Sarah.

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<v Matt>Where's <00:02:49.993>the <00:02:50.111>contracted <00:02:50.753>electricity <00:02:51.466>to <00:02:51.626>energize <00:02:52.186>it?

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<v Sarah>Honestly, <00:02:53.701>look <00:02:53.920>at <00:02:53.993>the <00:02:54.124>bookings.

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<v Sarah>$424 <00:02:56.563>million <00:02:57.402>annualized, <00:02:58.624>second-highest <00:02:59.386>on <00:02:59.562>record, <00:03:00.453>11% <00:03:01.533>MRR <00:03:02.247>growth — <00:03:03.146>third <00:03:03.449>straight <00:03:03.779>double-digit <00:03:04.433>quarter.

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<v Sarah>The <00:03:05.708>demand's <00:03:06.222>real. <00:03:06.862>But <00:03:07.122>the <00:03:07.242>balance <00:03:07.689>sheet <00:03:07.882>has <00:03:08.089>to <00:03:08.190>keep <00:03:08.489>up, <00:03:09.122>and <00:03:09.230>that <00:03:09.522>capex <00:03:10.222>band <00:03:10.588>points <00:03:10.915>to <00:03:11.062>a <00:03:11.171>yearly <00:03:11.646>trip <00:03:11.950>back <00:03:12.169>to <00:03:12.262>the <00:03:12.430>bond <00:03:12.691>market.

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<v Matt>And <00:03:13.886>read <00:03:14.162>the <00:03:14.302>fine <00:03:14.675>print — <00:03:15.550>that <00:03:15.822>134 <00:03:17.002>megawatts <00:03:17.555>of <00:03:17.822>xScale <00:03:18.392>brought <00:03:19.049>in <00:03:19.155>about <00:03:19.462>$120 <00:03:20.572>million <00:03:21.422>in <00:03:21.662>non-recurring <00:03:22.494>fees.

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<v Matt>That <00:03:23.886>fattens <00:03:24.402>the <00:03:24.542>EBITDA <00:03:25.079>margin <00:03:25.502>to <00:03:25.742>53%.

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<v Matt>Strip <00:03:27.842>the <00:03:27.952>leasing <00:03:28.366>fees <00:03:28.702>out <00:03:29.042>and <00:03:29.362>the <00:03:29.473>underlying <00:03:30.039>margin's <00:03:30.622>up <00:03:30.862>150 <00:03:31.729>basis <00:03:32.119>points, <00:03:32.842>not <00:03:33.182>300.

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<v Matt>Nice <00:03:34.762>quarter. <00:03:35.358>Just <00:03:35.782>don't <00:03:36.032>confuse <00:03:36.422>the <00:03:36.602>one-timer <00:03:37.230>with <00:03:37.442>the <00:03:37.582>run <00:03:37.886>rate.

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<v Sarah>Fair. <00:03:39.142>The <00:03:39.548>record <00:03:39.882>backlog <00:03:40.382>is <00:03:40.606>sold <00:03:40.942>but <00:03:41.242>not <00:03:41.462>yet <00:03:41.646>installed

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<v Sarah>which <00:03:42.835>means <00:03:43.122>the <00:03:43.249>interconnection <00:03:44.046>line <00:03:44.362>and <00:03:44.562>the <00:03:44.693>concrete <00:03:45.342>both <00:03:45.694>have <00:03:45.875>to <00:03:46.030>show <00:03:46.275>up <00:03:46.428>before <00:03:46.750>that <00:03:46.992>revenue <00:03:47.438>does.

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<v Sarah>TechStock2, <00:03:49.520>with <00:03:49.728>Iwona <00:03:50.108>Majkowska:

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<v Quote>The <00:03:51.592>strongest <00:03:52.147>indication <00:03:52.696>for <00:03:52.880>investors <00:03:53.496>can <00:03:53.669>be <00:03:53.816>found <00:03:54.056>beneath <00:03:54.376>the <00:03:54.544>main <00:03:54.789>bookings <00:03:55.273>figure.

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<v Quote>Leases <00:03:56.596>for <00:03:56.706>smaller <00:03:57.159>spaces <00:03:57.829>along <00:03:58.112>with <00:03:58.229>interconnection <00:03:59.176>accounted <00:03:59.576>for <00:03:59.776>$108.3 <00:04:01.076>million <00:04:01.803>in <00:04:01.913>annualized <00:04:02.560>rent

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<v Quote>making <00:04:03.563>up <00:04:04.056>52% <00:04:04.683>of <00:04:04.786>Digital <00:04:05.193>Realty’s <00:04:05.746>portion <00:04:06.123>of <00:04:06.229>newly <00:04:06.542>signed <00:04:06.867>agreements.

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<v Sarah>Digital <00:04:08.323>Realty's <00:04:08.894>10-Q <00:04:09.534>Friday: <00:04:10.201>small <00:04:10.825>leases, <00:04:11.566>from <00:04:12.094>zero <00:04:12.494>to <00:04:12.694>one <00:04:12.894>megawatt, <00:04:13.684>cleared <00:04:14.334>$280 <00:04:15.434>a <00:04:15.524>kilowatt.

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<v Sarah>Big <00:04:16.871>leases <00:04:17.267>above <00:04:17.594>one <00:04:17.894>meg — <00:04:18.694>$157.

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<v Sarah>That's <00:04:20.854>a <00:04:20.974>78 <00:04:21.494>percent <00:04:21.844>premium <00:04:22.374>for <00:04:22.514>the <00:04:22.624>smaller <00:04:23.038>footprint.

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<v Sarah>And <00:04:24.307>it's <00:04:24.534>not <00:04:24.694>a <00:04:24.778>rounding <00:04:25.201>error.

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<v Sarah>Small-space <00:04:26.718>plus <00:04:27.027>interconnection <00:04:27.758>came <00:04:28.067>to <00:04:28.294>$108 <00:04:29.084>million, <00:04:30.334>or <00:04:30.574>52 <00:04:31.174>percent <00:04:31.507>of <00:04:31.667>newly <00:04:31.991>signed <00:04:32.403>annualized <00:04:33.214>rent.

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<v Sarah>The <00:04:34.151>market's <00:04:34.690>treating <00:04:35.030>inference <00:04:35.574>and <00:04:35.758>bulk <00:04:36.084>compute <00:04:36.681>as <00:04:36.954>two <00:04:37.192>completely <00:04:37.806>different <00:04:38.174>products.

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<v Matt>Wait — <00:04:40.307>so <00:04:40.434>the <00:04:40.559>enterprise <00:04:41.278>guys <00:04:41.578>clearing <00:04:42.094>280 <00:04:42.854>are <00:04:43.305>subsidizing <00:04:44.214>the <00:04:44.391>hyperscalers <00:04:45.107>at <00:04:45.374>157 <00:04:46.454>per <00:04:46.634>kilowatt?

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<v Matt>The <00:04:48.140>little <00:04:48.471>tenant's <00:04:48.938>carrying <00:04:49.314>the <00:04:49.424>pricing <00:04:49.827>power <00:04:50.158>here, <00:04:50.894>not <00:04:51.154>the <00:04:51.274>gigawatt <00:04:51.841>whale.

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<v Matt>And <00:04:52.707>in <00:04:52.834>the <00:04:52.974>Americas, <00:04:53.954>the <00:04:54.083>markup <00:04:54.547>is <00:04:54.814>88 <00:04:55.364>percent.

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<v Matt>So <00:04:56.846>when <00:04:57.094>DLR <00:04:57.667>walks <00:04:57.998>back <00:04:58.281>to <00:04:58.354>the <00:04:58.484>utility <00:04:59.031>asking <00:04:59.414>for <00:04:59.630>load, <00:05:00.387>remember <00:05:00.854>who's <00:05:01.098>actually <00:05:01.511>paying <00:05:01.894>the <00:05:02.064>freight <00:05:02.467>on <00:05:02.606>that <00:05:02.794>balance <00:05:03.267>sheet.

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<v Sarah>The <00:05:04.307>stock <00:05:04.606>took <00:05:04.761>it <00:05:04.862>well, <00:05:05.194>too — <00:05:05.998>down <00:05:06.334>5.3 <00:05:07.187>on <00:05:07.314>the <00:05:07.438>week <00:05:07.747>to <00:05:07.934>$188.52.

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<v Sarah>Andy <00:05:11.667>Power's <00:05:12.054>out <00:05:12.238>crowing <00:05:12.694>about <00:05:12.944>topping <00:05:13.374>a <00:05:13.484>hundred <00:05:13.754>million <00:05:14.227>in <00:05:14.414>sub-meg <00:05:14.947>bookings <00:05:15.394>for <00:05:15.494>the <00:05:15.654>first <00:05:15.934>time; <00:05:16.834>the <00:05:16.958>tape <00:05:17.267>shrugged.

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<v Matt>Put <00:05:18.521>it <00:05:18.622>next <00:05:18.841>to <00:05:18.926>that <00:05:19.134>Equinix <00:05:19.758>bond <00:05:20.067>raise <00:05:20.361>we <00:05:20.478>just <00:05:20.854>hit — <00:05:21.742>everybody's <00:05:22.304>chasing <00:05:22.674>the <00:05:22.814>same <00:05:23.203>scarce <00:05:23.674>megawatt

60
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<v Matt>but <00:05:24.774>the <00:05:24.947>money's <00:05:25.340>coming <00:05:25.646>from <00:05:25.854>very <00:05:26.206>different <00:05:26.574>customers.

61
00:05:28.316 --> 00:05:30.396
<v Sarah>The <00:05:28.456>Motley <00:05:28.876>Fool, <00:05:29.404>with <00:05:29.644>Jeff <00:05:29.896>Siegel:

62
00:05:31.081 --> 00:05:39.401
<v Quote>Management <00:05:31.513>said <00:05:31.694>it <00:05:31.861>now <00:05:32.101>has <00:05:32.332>approximately <00:05:33.081>21 <00:05:33.701>gigawatts <00:05:34.308>of <00:05:34.428>large-load <00:05:35.125>interest <00:05:35.508>at <00:05:35.681>FPL, <00:05:36.649>with <00:05:37.001>12 <00:05:37.201>gigawatts <00:05:37.771>already <00:05:38.174>in <00:05:38.325>advanced <00:05:38.734>discussions.

63
00:05:39.801 --> 00:05:44.681
<v Quote>A <00:05:40.241>portion <00:05:40.548>of <00:05:40.641>those <00:05:40.903>projects <00:05:41.441>could <00:05:41.681>begin <00:05:41.938>taking <00:05:42.341>service <00:05:42.814>as <00:05:42.974>early <00:05:43.294>as <00:05:43.481>2028

64
00:05:44.701 --> 00:05:49.801
<v Quote>and <00:05:44.781>the <00:05:44.891>company <00:05:45.301>expects <00:05:45.748>to <00:05:45.845>announce <00:05:46.228>at <00:05:46.321>least <00:05:46.621>one <00:05:46.988>major <00:05:47.388>large-load <00:05:47.929>agreement <00:05:48.418>before <00:05:48.781>the <00:05:48.901>end <00:05:49.108>of <00:05:49.209>this <00:05:49.465>year.

65
00:05:50.060 --> 00:05:59.020
<v Matt>NextEra <00:05:50.837>bumped <00:05:51.340>FPL's <00:05:52.047>large-load <00:05:52.771>forecast <00:05:53.404>from <00:05:53.820>6 <00:05:54.120>gigawatts <00:05:54.833>to <00:05:55.100>8 <00:05:55.580>by <00:05:55.980>2032 — <00:05:57.620>a <00:05:57.780>third <00:05:58.460>higher.

66
00:05:59.244 --> 00:06:02.380
<v Matt>Data <00:06:00.200>centers <00:06:00.680>are <00:06:00.930>driving <00:06:01.460>the <00:06:01.651>increase.

67
00:06:02.680 --> 00:06:12.941
<v Matt>And <00:06:03.660>here's <00:06:04.100>the <00:06:04.268>part <00:06:04.540>I <00:06:04.673>actually <00:06:05.180>like: <00:06:05.740>they <00:06:06.433>built <00:06:06.740>a <00:06:06.860>tariff <00:06:07.393>to <00:06:07.564>keep <00:06:07.873>those <00:06:08.220>hyperscaler <00:06:09.127>costs <00:06:09.800>off <00:06:10.268>everybody <00:06:10.796>else's <00:06:11.436>bill.

68
00:06:12.998 --> 00:06:20.701
<v Sarah>Twenty-one <00:06:13.561>gigawatts <00:06:14.088>of <00:06:14.203>interest, <00:06:15.090>twelve <00:06:15.571>already <00:06:16.114>in <00:06:16.274>advanced <00:06:16.754>discussions, <00:06:17.773>with <00:06:17.965>some <00:06:18.267>taking <00:06:18.601>service <00:06:19.074>as <00:06:19.248>early <00:06:19.608>as <00:06:19.741>2028.

69
00:06:20.841 --> 00:06:28.141
<v Sarah>Now <00:06:21.321>put <00:06:21.533>that <00:06:21.709>next <00:06:21.954>to <00:06:22.121>Equinix: <00:06:23.421>700 <00:06:23.781>megawatts <00:06:24.261>under <00:06:24.535>construction <00:06:25.481>and <00:06:25.741>3 <00:06:26.021>gigawatts <00:06:26.514>of <00:06:26.701>land <00:06:27.048>under <00:06:27.261>control.

70
00:06:28.248 --> 00:06:33.741
<v Sarah>In <00:06:28.521>one <00:06:28.765>news <00:06:29.088>cycle, <00:06:29.798>demand <00:06:30.168>is <00:06:30.301>piling <00:06:30.674>up <00:06:30.834>on <00:06:31.001>one <00:06:31.261>side <00:06:31.621>while <00:06:31.890>supply <00:06:32.371>strains <00:06:32.888>on <00:06:32.981>the <00:06:33.154>other.

71
00:06:33.901 --> 00:06:39.661
<v Sarah>By <00:06:34.265>management's <00:06:34.841>own <00:06:35.101>math, <00:06:35.808>every <00:06:36.201>gigawatt <00:06:36.754>means <00:06:37.071>roughly <00:06:37.501>two <00:06:37.821>billion <00:06:38.434>in <00:06:38.601>new <00:06:38.834>infrastructure.

72
00:06:39.848 --> 00:06:46.461
<v Sarah>At <00:06:40.261>eight <00:06:40.521>gigawatts, <00:06:41.281>you're <00:06:41.471>talking <00:06:41.891>sixteen <00:06:42.441>billion <00:06:42.914>in <00:06:43.091>capital <00:06:43.661>that <00:06:44.041>has <00:06:44.248>to <00:06:44.341>get <00:06:44.514>built <00:06:44.801>and <00:06:44.925>paid <00:06:45.281>for.

73
00:06:46.514 --> 00:06:53.941
<v Matt>Right. <00:06:46.994>Dominion <00:06:48.141>left <00:06:48.557>cost-shifting <00:06:49.474>to <00:06:49.601>the <00:06:49.723>customer's <00:06:50.452>goodwill — <00:06:51.701>a <00:06:51.813>voluntary <00:06:52.529>contribution.

74
00:06:54.241 --> 00:06:58.221
<v Matt>FPL <00:06:54.994>wrote <00:06:55.301>the <00:06:55.501>isolation <00:06:56.283>straight <00:06:56.861>into <00:06:57.201>the <00:06:57.325>rate <00:06:57.661>design.

75
00:06:58.363 --> 00:07:05.181
<v Matt>Dominion's <00:06:59.627>hoping <00:06:59.921>the <00:07:00.050>hyperscaler <00:07:00.834>chips <00:07:01.181>in; <00:07:02.221>FPL <00:07:02.941>made <00:07:03.288>it <00:07:03.406>structural.

76
00:07:05.197 --> 00:07:09.901
<v Sarah>They're <00:07:05.405>also <00:07:05.717>promising <00:07:06.274>at <00:07:06.421>least <00:07:06.721>one <00:07:07.101>major <00:07:07.568>large-load <00:07:08.269>agreement <00:07:08.758>before <00:07:09.149>year-end.

77
00:07:09.999 --> 00:07:12.301
<v Sarah>Interest <00:07:10.834>is <00:07:11.101>21 <00:07:11.561>gigawatts.

78
00:07:12.404 --> 00:07:14.541
<v Sarah>Signed <00:07:13.101>is <00:07:13.314>still <00:07:13.677>zero.

79
00:07:14.581 --> 00:07:20.141
<v Sarah>The <00:07:14.761>utility's <00:07:15.377>planning <00:07:15.707>around <00:07:16.013>that <00:07:16.198>signal <00:07:16.598>before <00:07:17.021>a <00:07:17.147>single <00:07:17.485>yard <00:07:17.794>of <00:07:17.963>concrete <00:07:18.509>gets <00:07:18.770>poured.

80
00:07:20.212 --> 00:07:23.181
<v Matt>Advanced <00:07:20.861>discussions <00:07:21.789>aren't <00:07:22.221>take-or-pay.

81
00:07:23.357 --> 00:07:28.061
<v Matt>Show <00:07:24.114>me <00:07:24.241>the <00:07:24.372>contract <00:07:24.973>with <00:07:25.141>a <00:07:25.231>penalty <00:07:25.634>attached, <00:07:26.521>and <00:07:26.749>then <00:07:26.981>I'll <00:07:27.151>believe <00:07:27.541>the <00:07:27.714>eight.

82
00:07:28.816 --> 00:07:33.296
<v Matt>Stargate <00:07:29.349>keeps <00:07:29.660>dropping <00:07:30.080>site <00:07:30.393>announcements <00:07:31.196>and <00:07:31.456>gigawatt <00:07:32.076>projections.

83
00:07:33.376 --> 00:07:35.616
<v Matt>So <00:07:33.616>how <00:07:33.883>do <00:07:33.996>you <00:07:34.222>stress-test <00:07:34.856>those <00:07:35.116>numbers?

84
00:07:35.744 --> 00:07:42.816
<v Matt>What's <00:07:36.376>the <00:07:36.525>difference <00:07:36.856>between <00:07:37.176>a <00:07:37.269>headline <00:07:37.767>capacity <00:07:38.393>figure <00:07:38.876>and <00:07:39.356>megawatts <00:07:39.968>that <00:07:40.156>can <00:07:40.389>actually <00:07:40.869>close <00:07:41.208>financing <00:07:41.916>and <00:07:42.128>take <00:07:42.323>power?

85
00:07:43.114 --> 00:07:47.034
<v Sarah>The <00:07:43.274>gap <00:07:43.567>is <00:07:43.741>substantial, <00:07:44.674>and <00:07:44.814>you <00:07:44.934>can <00:07:45.134>see <00:07:45.247>it <00:07:45.381>in <00:07:45.514>a <00:07:45.654>few <00:07:45.887>specific <00:07:46.378>documents.

86
00:07:47.114 --> 00:07:49.034
<v Sarah>Take <00:07:47.454>the <00:07:47.594>Abilene <00:07:48.074>flagship.

87
00:07:49.114 --> 00:07:58.154
<v Sarah>Per <00:07:49.402>reporting <00:07:49.914>in <00:07:50.194>“Wiring <00:07:50.854>Capital <00:07:51.327>to <00:07:51.504>Compute,” <00:07:52.434>the <00:07:52.611>campus <00:07:53.007>is <00:07:53.194>visibly <00:07:53.818>half-alive: <00:07:55.242>some <00:07:55.487>quadrants <00:07:56.026>have <00:07:56.221>operational <00:07:57.021>substations

88
00:07:58.194 --> 00:08:00.154
<v Sarah>while <00:07:58.451>others <00:07:58.814>are <00:07:58.941>empty <00:07:59.386>pads.

89
00:08:00.314 --> 00:08:04.794
<v Sarah>Schedules <00:08:00.834>are <00:08:01.004>sliding <00:08:01.421>right <00:08:01.882>even <00:08:02.447>as <00:08:02.594>the <00:08:02.767>supercomputer <00:08:03.503>itself <00:08:03.967>is <00:08:04.134>running.

90
00:08:04.922 --> 00:08:06.634
<v Sarah>That's <00:08:05.534>the <00:08:05.647>baseline <00:08:06.143>signal.

91
00:08:06.814 --> 00:08:12.074
<v Sarah>Announced <00:08:07.665>capacity <00:08:08.314>and <00:08:08.621>energized <00:08:09.345>capacity <00:08:10.017>belong <00:08:10.687>on <00:08:10.834>different <00:08:11.258>line <00:08:11.594>items.

92
00:08:12.434 --> 00:08:14.554
<v Sarah>I <00:08:12.714>use <00:08:13.002>four <00:08:13.263>layers <00:08:13.701>to <00:08:13.807>separate <00:08:14.282>them.

93
00:08:14.661 --> 00:08:19.034
<v Sarah>Start <00:08:15.226>with <00:08:15.407>interconnection <00:08:16.114>queue <00:08:16.367>position <00:08:16.934>and <00:08:17.425>executed <00:08:18.044>service <00:08:18.445>agreements.

94
00:08:19.124 --> 00:08:25.754
<v Sarah>Without <00:08:19.794>a <00:08:19.903>signed <00:08:20.394>Large <00:08:20.850>Generator <00:08:21.421>Interconnection <00:08:22.122>Agreement <00:08:22.741>or <00:08:23.210>Load <00:08:23.661>Interconnection <00:08:24.434>Service <00:08:24.770>Agreement

95
00:08:25.794 --> 00:08:28.994
<v Sarah>those <00:08:26.054>megawatts <00:08:26.654>are <00:08:26.767>still <00:08:27.082>just <00:08:27.314>a <00:08:27.450>plan <00:08:27.887>on <00:08:28.034>a <00:08:28.122>land <00:08:28.394>parcel.

96
00:08:29.210 --> 00:08:32.714
<v Sarah>Then <00:08:29.626>look <00:08:29.794>for <00:08:29.967>power <00:08:30.298>contracts <00:08:30.906>with <00:08:31.114>actual <00:08:31.645>commercial <00:08:32.234>terms.

97
00:08:32.834 --> 00:08:34.794
<v Sarah>The <00:08:33.238>Michigan <00:08:33.642>site <00:08:33.887>is <00:08:34.034>a <00:08:34.090>good <00:08:34.224>example.

98
00:08:34.934 --> 00:08:45.514
<v Sarah>The <00:08:35.390>Michigan <00:08:35.834>PSC <00:08:36.394>voted <00:08:36.954>3-0 <00:08:37.861>in <00:08:37.985>December <00:08:38.714>to <00:08:39.090>conditionally <00:08:39.814>approve <00:08:40.314>a <00:08:40.474>19-year, <00:08:41.914>1.4 <00:08:42.794>gigawatt <00:08:43.407>power <00:08:43.731>supply <00:08:44.114>agreement <00:08:44.506>with <00:08:44.794>DTE.

99
00:08:45.654 --> 00:08:49.834
<v Sarah>Per <00:08:46.136>Latitude <00:08:46.687>Media's <00:08:47.105>analysis, <00:08:48.122>that's <00:08:48.534>a <00:08:48.709>financeable <00:08:49.172>instrument.

100
00:08:50.138 --> 00:08:52.234
<v Sarah>Next, <00:08:50.866>equipment <00:08:51.567>commitments.

101
00:08:52.354 --> 00:08:59.514
<v Sarah>The <00:08:52.874>“Wiring <00:08:53.494>Capital <00:08:53.967>to <00:08:54.134>Compute” <00:08:54.701>piece <00:08:55.154>and <00:08:55.534>the <00:08:55.644>broader <00:08:56.114>capex <00:08:56.785>analysis <00:08:57.434>in <00:08:57.754>“12 <00:08:58.294>Gigawatts <00:08:58.826>Were <00:08:58.994>Announced

102
00:08:59.834 --> 00:09:06.394
<v Sarah>4 <00:09:00.114>Are <00:09:00.287>Being <00:09:00.621>Built” <00:09:01.082>make <00:09:01.614>the <00:09:01.722>same <00:09:01.994>point: <00:09:02.814>the <00:09:02.934>binding <00:09:03.412>constraint <00:09:04.074>sits <00:09:04.474>two <00:09:04.771>layers <00:09:05.181>below <00:09:05.534>the <00:09:05.774>GPU.

103
00:09:06.607 --> 00:09:09.994
<v Sarah>It's <00:09:07.176>transformers, <00:09:08.063>switchgear, <00:09:08.914>and <00:09:09.074>circuit <00:09:09.407>breakers.

104
00:09:10.141 --> 00:09:14.714
<v Sarah>Under <00:09:11.034>10% <00:09:11.541>of <00:09:11.614>the <00:09:11.727>total <00:09:12.074>cost <00:09:12.447>is <00:09:12.611>gating <00:09:13.034>100% <00:09:13.941>of <00:09:14.014>the <00:09:14.136>schedule.

105
00:09:15.162 --> 00:09:19.194
<v Sarah>Last, <00:09:15.834>inspect <00:09:16.434>the <00:09:16.618>take-or-pay <00:09:17.461>or <00:09:17.754>offtake <00:09:18.290>structure.

106
00:09:19.314 --> 00:09:27.354
<v Sarah>A <00:09:19.501>power <00:09:19.896>contract <00:09:20.426>that <00:09:20.607>doesn't <00:09:21.007>allocate <00:09:21.514>curtailment <00:09:22.154>risk <00:09:22.514>and <00:09:22.696>capacity <00:09:23.238>payments <00:09:23.647>to <00:09:23.834>a <00:09:23.960>creditworthy <00:09:24.534>counterparty <00:09:25.694>won't <00:09:26.134>get <00:09:26.374>project-finance

107
00:09:27.402 --> 00:09:31.754
<v Sarah>treatment. <00:09:28.154>On <00:09:28.494>the <00:09:28.602>grid <00:09:28.874>side, <00:09:29.674>Texas <00:09:30.127>needs <00:09:30.454>its <00:09:30.714>own <00:09:31.021>scorecard.

108
00:09:31.914 --> 00:09:38.794
<v Sarah>Per <00:09:32.434>reporting <00:09:32.842>from <00:09:33.101>April, <00:09:33.834>Stargate's <00:09:34.527>three <00:09:34.887>Texas <00:09:35.402>footprints <00:09:35.994>are <00:09:36.282>each <00:09:36.527>handling <00:09:36.974>the <00:09:37.101>interconnection <00:09:37.887>queue <00:09:38.201>differently.

109
00:09:38.994 --> 00:09:43.594
<v Sarah>One <00:09:39.701>is <00:09:39.962>grid <00:09:40.234>hybrid, <00:09:41.154>and <00:09:41.324>another <00:09:41.770>uses <00:09:42.223>islanded <00:09:42.874>gas.

110
00:09:44.305 --> 00:09:48.305
<v Sarah>At <00:09:44.425>the <00:09:44.625>third, <00:09:45.471>public <00:09:45.812>disclosures <00:09:46.585>still <00:09:46.825>don't <00:09:47.078>match <00:09:47.365>the <00:09:47.475>tracker <00:09:47.905>data.

111
00:09:48.449 --> 00:09:51.703
<v Sarah>That <00:09:49.087>mismatch <00:09:49.638>is <00:09:49.825>itself <00:09:50.345>a <00:09:50.445>due-diligence <00:09:51.201>flag.

112
00:09:51.703 --> 00:09:58.625
<v Matt>On <00:09:51.969>that <00:09:52.294>islanded-gas <00:09:53.309>approach <00:09:53.718>in <00:09:53.985>Texas — <00:09:55.057>does <00:09:55.238>going <00:09:55.551>around <00:09:55.845>the <00:09:55.985>grid <00:09:56.403>actually <00:09:57.265>de-risk <00:09:57.845>the <00:09:57.985>project?

113
00:09:58.865 --> 00:10:05.051
<v Matt>Or <00:09:59.393>does <00:09:59.612>it <00:09:59.713>just <00:09:59.985>swap <00:10:00.358>interconnection <00:10:01.105>risk <00:10:01.525>for <00:10:01.905>fuel-supply <00:10:02.745>and <00:10:02.909>permitting <00:10:03.409>risk <00:10:03.729>that's <00:10:04.111>harder <00:10:04.412>to <00:10:04.532>model?

114
00:10:05.051 --> 00:10:09.825
<v Sarah>It <00:10:05.505>trades <00:10:05.825>the <00:10:05.985>interconnection <00:10:06.678>queue <00:10:06.985>for <00:10:07.165>air <00:10:07.415>permits <00:10:07.945>and <00:10:08.145>gas-supply <00:10:08.857>contracts.

115
00:10:09.885 --> 00:10:15.745
<v Sarah>Neither <00:10:10.358>route <00:10:10.652>is <00:10:10.769>obviously <00:10:11.425>easier, <00:10:12.325>and <00:10:12.425>the <00:10:12.585>capital <00:10:12.925>markets <00:10:13.385>haven't <00:10:13.718>fully <00:10:14.081>repriced <00:10:14.753>that <00:10:15.025>swap <00:10:15.425>yet.

116
00:10:15.873 --> 00:10:20.305
<v Sarah>Here's <00:10:16.529>what <00:10:16.652>to <00:10:16.772>watch: <00:10:17.265>whether <00:10:17.845>the <00:10:17.974>Norway <00:10:18.455>project <00:10:18.985>and <00:10:19.125>the <00:10:19.265>five <00:10:19.645>new <00:10:19.945>U.S.

117
00:10:20.372 --> 00:10:27.105
<v Sarah>sites <00:10:20.795>produce <00:10:21.505>executed <00:10:22.212>power <00:10:22.596>agreements <00:10:23.137>with <00:10:23.345>named <00:10:23.792>counterparties <00:10:24.665>and <00:10:25.081>disclosed <00:10:25.656>capacity <00:10:26.305>terms

118
00:10:27.158 --> 00:10:30.145
<v Sarah>or <00:10:27.329>stay <00:10:27.638>at <00:10:27.765>the <00:10:27.985>MOU <00:10:28.525>and <00:10:28.751>letter-of-intent <00:10:29.665>stage.

119
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<v Sarah>That's <00:10:30.892>where <00:10:31.065>the <00:10:31.305>$500 <00:10:31.835>billion <00:10:32.525>promise <00:10:32.998>meets <00:10:33.285>the <00:10:33.425>substation, <00:10:34.585>and <00:10:34.725>the <00:10:34.865>substation <00:10:35.478>is <00:10:35.612>where <00:10:35.765>the <00:10:35.896>contract <00:10:36.577>dies.

120
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<v Host>If <00:10:38.455>you <00:10:38.609>follow <00:10:38.855>the <00:10:39.012>infrastructure <00:10:39.597>powering <00:10:40.255>AI

121
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<v Host>check <00:10:41.275>out <00:10:41.588>AI <00:10:41.908>Daily <00:10:42.228>Briefing — <00:10:43.435>top <00:10:43.722>AI <00:10:44.015>news <00:10:44.355>for <00:10:44.479>engineers

122
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<v Host>founders <00:10:45.635>and <00:10:45.767>investors

123
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<v Host>with <00:10:47.023>real <00:10:47.270>capabilities <00:10:47.983>separated <00:10:48.447>from <00:10:48.639>demo <00:10:48.959>hype <00:10:49.268>every <00:10:49.595>weekday.

124
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<v Host>Find <00:10:50.922>it <00:10:51.019>wherever <00:10:51.395>you <00:10:51.489>listen <00:10:51.748>to <00:10:51.935>podcasts.

125
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<v Host>We'll <00:10:53.743>be <00:10:53.814>watching <00:10:54.218>Iron <00:10:54.446>Mountain's <00:10:54.870>results <00:10:55.317>ahead <00:10:55.477>of <00:10:55.570>Wednesday's <00:10:56.056>market <00:10:56.410>open.

126
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<v Host>That'll <00:10:57.562>give <00:10:57.743>us <00:10:57.890>another <00:10:58.250>read <00:10:58.623>on <00:10:58.794>data <00:10:59.096>center <00:10:59.423>REIT <00:10:59.670>leasing <00:11:00.130>and <00:11:00.310>capital <00:11:00.810>needs.

127
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<v Host>And <00:11:01.994>NextEra <00:11:02.460>expects <00:11:02.837>to <00:11:02.934>announce <00:11:03.317>at <00:11:03.410>least <00:11:03.710>one <00:11:04.063>major <00:11:04.397>large-load <00:11:04.938>agreement <00:11:05.416>before <00:11:05.754>year-end.

128
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<v Host>You'll <00:11:07.098>find <00:11:07.343>links <00:11:07.637>to <00:11:07.757>every <00:11:08.157>story <00:11:08.517>in <00:11:08.623>today's <00:11:09.002>show <00:11:09.183>notes <00:11:09.503>if <00:11:09.630>you'd <00:11:09.722>like <00:11:09.903>to <00:11:10.050>dig <00:11:10.218>into <00:11:10.470>any <00:11:10.677>of <00:11:10.778>them.

129
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<v Host>That's <00:11:11.950>The <00:11:12.058>Data <00:11:12.296>Center <00:11:12.623>Daily <00:11:12.930>for <00:11:13.130>today.

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<v Host>This <00:11:14.437>is <00:11:14.690>a <00:11:14.780>Lantern <00:11:15.220>Podcast.