1606 Corp. (OTC: CBDW) has entered into a non-binding term sheet to acquire a 55-megawatt power generation facility and a 50,000 square-foot climate-controlled warehouse in Texas configured for data center operations. The proposed $11.67 million transaction includes approximately 132 acres of real property and associated infrastructure, designed to operate as a behind-the-meter captive power generation asset supporting artificial intelligence and high-density data center projects onsite.
The acquisition represents a strategic expansion into captive power infrastructure for AI and data centers, strengthening 1606 Corp.'s scalable energy portfolio. The transaction contemplates $7.5 million in cash at closing and the assumption of approximately $4.17 million in existing indebtedness related to the power plant. The parties have agreed to an exclusivity period during negotiations of definitive agreements, with the transaction expected to close on or before March 11, 2026, subject to customary closing conditions.
This move comes as the global captive power generation market, valued at approximately $227.9 billion in 2025, is projected to reach $310.9 billion by 2030, representing a compound annual growth rate of 6.4%. Within this sector, the data center power infrastructure market is expected to expand from $20.2 billion in 2024 to $42.4 billion by 2030, growing at a CAGR of 13.2%. These projections are detailed in market reports from sources including Mordor Intelligence and Grand View Research.
The accelerating demand is driven by the rapid expansion of AI workloads and high-density computing, with global data center electricity demand forecast to more than double from 61.8 GW in 2025 to 134.4 GW by 2030 according to S&P Global. This growth is fueling investments in captive and on-site power assets as operators seek energy security, cost control, and sustainability. Captive energy systems are increasingly viewed as critical enablers of AI infrastructure, ensuring reliable, low-latency power delivery for compute-intensive operations.
1606 Corp. is currently in negotiations to acquire Sim Agro Inc., a privately held power plant operations and energy infrastructure company with international expertise in high-efficiency generation projects. Upon closing, Sim Agro is expected to oversee operations of the Texas generation facility and support 1606 Corp.'s broader infrastructure platform. The company's leadership emphasizes that this transaction represents a key milestone in executing their strategy to develop a scalable portfolio of energy infrastructure assets capable of supporting next-generation AI and data center demand.
The sector's evolution toward renewable and hybrid energy models presents a long-term growth opportunity for investors focused on infrastructure, clean energy, and digital transformation. As grid congestion and connection delays intensify, these private generation assets offer a strategic advantage for hyperscalers and colocation providers alike, positioning companies with captive power infrastructure to benefit from the ongoing digital transformation driven by artificial intelligence adoption across industries.
