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Chevron (CVX) announced Monday that it will power a huge Microsoft (MSFT) data center in West Texas with natural gas, using gas turbines supplied by GE Vernova (GEV) and Caterpillar (CAT). GE Vernova stock rose near a buy point, and Caterpillar stock jumped.
Project Kilby, as it is known, is expected to produce 2.7 gigawatts of electricity. That is said to be enough capacity to power about 2 million homes. A majority of the electricity will come from large gas turbines supplied by GE Vernova, Chevron said. Additional capacity will be provided by a Caterpillar subsidiary called Solar Turbines.
"The rapid growth we're experiencing in artificial intelligence (AI) and cloud, driven by customer demand, requires energy infrastructure that can scale quickly and reliably," said Noelle Walsh, Microsoft president of cloud operations, in the news release.
Compared with alternative sources of energy, gas-fired power plants hold an advantage in terms of speed to market. For example, new nuclear reactors can involve extremely lengthy testing and permitting times.
The 20-year power purchase agreement for Project Kilby marks a first for energy giant Chevron: its debut as a direct utility-style power provider for the technology sector amid the AI boom.
Project Kilby, as it is known, is expected to produce 2.7 gigawatts of electricity. That is said to be enough capacity to power about 2 million homes. A majority of the electricity will come from large gas turbines supplied by GE Vernova, Chevron said. Additional capacity will be provided by a Caterpillar subsidiary called Solar Turbines.
"The rapid growth we're experiencing in artificial intelligence (AI) and cloud, driven by customer demand, requires energy infrastructure that can scale quickly and reliably," said Noelle Walsh, Microsoft president of cloud operations, in the news release.
Compared with alternative sources of energy, gas-fired power plants hold an advantage in terms of speed to market. For example, new nuclear reactors can involve extremely lengthy testing and permitting times.
The 20-year power purchase agreement for Project Kilby marks a first for energy giant Chevron: its debut as a direct utility-style power provider for the technology sector amid the AI boom.
