Chevron and Partners to Develop Natural Gas-Fired Power Plants for Data Centers

Key Points:

* Chevron, Engine No. 1, and GE Vernova form partnership for data center power plants.
* Multi-gigawatt plant expected by end of 2027, potentially powering 3.5 million homes.
* Plants to utilize natural gas-fired GE Vernova turbines.
* Initial focus on US Southeast, West, and Midwest regions.
* Partnership capitalizes on surging AI demand for electricity.
* Gas plants considered competitive due to lower costs and faster construction times.

Collaboration and Investment:

Chevron, Engine No. 1, and GE Vernova intend to invest in the development of power plants that will provide direct power to adjacent data centers. These facilities will utilize GE Vernova gas turbines, offering reliable and cost-effective electricity generation.

Market Outlook and Competition:

With data centers driving a significant increase in electricity demand, the partnership aims to tap into the growing market. Despite concerns raised by DeepSeek's energy-efficient AI model, gas plants remain a competitive solution due to their affordability and flexibility.

Expansion and Future Goals:

The partners plan to construct plants with a capacity of up to four gigawatts by 2027, with a long-term goal of supplying clean and reliable energy to power the digital infrastructure of the future. The collaboration aligns with Chevron's commitment to energy dominance and national security, as stated by CEO Mike Wirth.

Industry Context:

GE Vernova, a spin-off from General Electric, has been a key player in the AI-driven power boom. Engine No. 1 gained prominence in 2021 after its successful proxy fight against Exxon Mobil, advocating for ESG investments. Exxon recently announced its own efforts to provide emission-free electricity to data centers.