Chevron wants to tap in AI Boom by selling electricity to data centers

Artificial Intelligence Boom has an electrical turbocharged demand, and everyone who wants anyone in the American energy industry wants a piece of action.

The latest admitted is Chevron, the second largest oil and gas company in the country, which sees opportunities in the manufacture of natural gas-fuel power plants that will directly feed the data centers.

Chevron is working with engine number 1, an investment firm in San Francisco, known for a successful proxy battle against Axon Mobil in 2021. Companies say they have ordered important equipment, scouting potential sites and can do the online plant online. three years.

“This is a chance for us to help fulfill this moment and address this growing requirement for reliable and inexpensive power.”

Chevron announcement is only the latest example of how much AI’s promise – an electric consumer – is re -shaping the economy. Oil producers are rebuilding their strategies and tilting in power generation, a business that many of them had administered the first oath because it was much less profitable than drilling and processing oil and gas. Last month, Exon stated that this too, wanted to go into the business of selling electricity to data centers.

But in a reminder that AI data centers and possibilities for increasing power are highly uncertain, technology and energy stocks tumbled on Monday. Investors were unnecessarily unnecessary in the AI ​​created by an unfamiliar Chinese start-up, Deepsek, saying that it had earned its own advantage using a minor number of computer chips that consumed relatively low energy. Chip-producer Nvidia shares shut down 17 percent and a large power producer, constellation energy stocks more than 20 percent.

“There is always the ability to surprise you for markets,” said Mr. Varth. But he said that the early market for the market and keeping its cost low will protect the Chevron from the possibility that the increase in electricity demand is reduced by the current expectations.

His company is hardly alone.

Many power producers are doing bags, and many are particularly investing in natural gas production capacity. Nakshatra, which has a large fleet of atomic power plants, agreed to buy rival Calpin this month, owned by many natural gas plants, for $ 16.4 billion. And last week, Nextra Energy said it was planning to build high gas-fuel power plants.

Expectations will be widely different for how much and how quickly and how quickly and how quickly the demand for US electricity will increase. What is clear that data centers are likely to consume the country’s power much more than today. A recent study by Lawrence Burkeley National Laboratory It was estimated that in 2028, in 2023, there are facilities to use 12 percent of American electricity, which is more than 4.4 percent in 2023.

Chevron and engine number 1 stated that they have reserved seven gas turbines from GE Vernova, one of the companies made by normal electric breakups. The device is scheduled to start in 2026. Chevron and engine number 1, which does not explain how much they are planning to spend, are interacting with potential customers and expecting to build up to four gigawatts of gas-edged capacity.

The cost of natural gas -powered power plants has recently been estimated by Morgan Stanley, about $ 2 billion per gigawatt.

In this case, the plant will be located with data centers that they give strength. Like Exon, partners hope that they will not be associated with electric grids to start their facilities, so the plants can rise and walk more quickly. Grid managers may take years to approve connection requests.

Eventually, they aim to secure the grid hookup, Chris James, Chief Investment Officer of Engine No. 1. “A grid interconnect allows us to be able to return power if needed,” he said.

Technology giants like Microsoft and Google have set goals to achieve all their energy from sources that do not contribute to climate change after taking into account carbon captures and other technologies. But some technical companies now said that they will work hard to get all the power in the next few years without relying on natural gas, which produces carbon dioxide when burns. Greenhouse gas is a major cause of climate change.

Jessie Nofinger, a partner of the consultation firm McCinse and Company, said, “This is now and again the valley, which scratches many people to their heads and feel that if you don’t bow down on gas, So the answer may be bad, “Jesse Nofinger, a partner of the counseling firm McKins’ & Company, said.

Chevron and engine number 1 said their plants can be made in many areas. He has denied the east coast due to infrastructure deficiency and reaction to potential customers.

Companies also searched for sites Able to capture and indexes carbon dioxide emissions, Mr. James said.

Companies, however, do not plan to include that technology or renewable energy, though.

“We are very confident that over time the atmosphere of policy makes itself clear, because we make good progress on technology development, that some of these other options will be part of it,” Mr. Varth said.