Chevron has signed a 20-year power purchase agreement with Microsoft to provide natural gas-fired electricity for the Kilby data center complex in West Texas. The project aims to deliver 2.67 gigawatts of electricity, enough to power about 2 million homes, using gas from Chevron's Permian Basin operations.
Expected to generate over $10 billion in tax revenue and create nearly 2,000 jobs, the Kilby project plans its first power generation output by 2028. Chevron will operate without a middleman, directly supplying power to Microsoft, thus ensuring revenue predictability.
This collaboration not only enhances Chevron's role as a direct power provider but also reflects a strategic pivot towards a more integrated energy model, supported by the investment firm Engine No. 1, known for advocating energy transition planning.