Nscale & Microsoft partner with Nvidia & Caterpillar to scale new AI data centre

The letter of intent Nscale has signed with Microsoft would set up the AI campus as a global flagship deployment of the Nvidia GPUs, along with the Vera Rubin NVL72 systems engineered with the Nvidia Vera Rubin DSX AI Factory reference design.

Under the terms of the collaboration with Microsoft, Nscale said it will construct and operate advanced AI data centre infrastructure to host the GPU deployment. It will be delivered across multiple tranches beginning in late 2027, with the companies expecting the creation of one of the largest dedicated AI compute installations in the world.

“This collaboration with Microsoft marks a pivotal milestone both for Nscale and the development of the Monarch Campus,” said Josh Payne, CEO of Nscale. “By integrating our specialised AI infrastructure with Microsoft’s global platform, we are creating a foundation for innovation that can scale alongside the most ambitious AI models in the world.”

Building capacity to support AI demand

Nscale has also announced that it will be acquiring American Intelligence & Power Corporation (AIPCorp), which includes the Monarch Compute Campus – a site with up to 2,250 acres in Mason County, West Virginia. This is expected to be the first state-certified AI microgrid in the US with a power runway scalable to over eight gigawatts.

The planned infrastructure will operate under a long-term framework that includes an initial multi-year compute services term alongside a long-term data centre lease structure. This could position the campus to be a strong facility for next-generation AI training and inference capacity in the US.

Such a collaboration comes at a critical moment, as AI is expected to keep driving significant global data centre demand. However, estimates suggest existing supply is constrained by the speed at which power and new capacity can be brought online – with McKinsey estimating that AI-related data centre capacity demand could reach 156GW by 2030.

To combat this, the Monarch Compute Campus will build on Nscale’s current capacity of over 1GW. Expansion capabilities have the potential for a total power draw of 8GW, which could enable Nscale to develop power capacity rapidly while supporting one of the largest announced AI compute deployments in the market today.

The campus is also expected to provide high-speed fibre connectivity to some of the nation’s largest AI hubs – with its close proximity to major centres of AI and cloud infrastructure will offer customers low latency and minimal delays for AI workloads.

“Microsoft’s data centre approach is to build the best global infrastructure informed by near-term and long-term demand,” said Jon Tinter, president, business development and ventures at Microsoft.

“Our investments blend owned data centres, leased facilities and strategic collaborations. This collaboration with Nscale and Nvidia is an important step to deliver meaningful AI innovation to our customers.”

Power that gives back

As part of a strategic collaboration with Caterpillar, Nscale will deploy a Caterpillar G3500 series natural gas generator to achieve two gigawatts of power generation by the first half of 2028. It will power the Nvidia Vera Rubin DSX AI Factory reference design.

The G3500 series units provide Nscale with a proven, rapid-deployment power solution that collapses traditional infrastructure timelines and accelerates the path from site to live compute.

“This collaboration reflects Caterpillar and our dealers’ continued focus on supporting customers that require primary, continuous-duty power at scale through our broad energy solutions portfolio,” said Melissa Busen, senior vice president of Electric Power at Caterpillar.

“Projects like Monarch demonstrate how Caterpillar’s natural gas generation platforms are being deployed as core infrastructure for data centres and other power-intensive applications where reliability, speed of deployment and lifecycle performance are critical.”

Nico Caprez, vice president of global AI infrastructure growth at Nvidia, added: “AI is becoming essential infrastructure for every industry. With this large-scale NVIDIA DSX AI Factory Blueprint, Nscale is building the infrastructure required to produce intelligence at industrial scale and power the next wave of global innovation.”

Nscale is also working closely with state and local officials and community partners to ensure the development creates lasting value for the region. The campus is being designed with local and environmental resources in mind, in addition to power being generated on-site as the facility operates independently from the local grid.

The microgrid is designed to enable future tie-in to the grid for export of power back to the grid.

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Datacloud Global Congress

Industry heavyweights from the data centre sector will convene at this year’s Datacloud Global Congress, where power and energy management will be a key focus. With AI workloads driving record electricity demand, the event will spotlight strategies for self-generated power, grid resilience, and sustainable energy integration. Attendees can expect in-depth discussions on how recent initiatives, such as the Ratepayer Protection Pledge, are reshaping the economics and operations of hyperscale and edge data centres worldwide. To register for the event, click here.