Chevron Prepares to Fuel Artificial Intelligence with Natural Gas
Here's the rewritten version of the article:
Plenty of folks are aware that utilizing generative AI tools leads to a massive consumption of water. But if that wasn't enough to raise environmental concern, Chevron is ready to kick things up a notch. According to a report in The New York Times, the second-largest fossil fuel company in the US is teaming up with an investment firm to construct natural gas power plants tailored specifically for data centers. With the entire market reevaluating whether we truly need to burn through all these resources for AI models, Chevron's move seems perfectly timed.
The Times reports that Chevron is already placing orders for equipment and scouting potential locations for these power plants, aiming to set them up within three years. Chevron CEO Mike Wirth stated that the plan is to "meet the moment and address this growing need for reliable and affordable power."
Research from Goldman Sachs suggests that data center power demand is set to grow 160% by 2030, and companies that can swiftly accommodate this will reap the financial benefits from the estimated $500 billion spent on expanding data center infrastructure. Given Chevron's recent history of favoring the more profitable business of oil and gas production, it appears that powering data centers is an attractive venture.
Not ideal timing for Chevron's announcement, though, as the global AI community has been promoting the idea that AI can only progress if we continue consuming more power, energy, and processing capacity. In stark contrast, just as Chevron is about to take the stage, China-based DeepSeek has unveiled its own AI model that challenges Big Tech offerings while costing less.
This shift in Chevron's direction towards becoming an AI power facilitator seems to be in part due to activist investment firm Engine No. 1. Known for their focus on social good, Engine No. 1 recently spearheaded a successful bid to push Exxon Mobil towards a carbon-conscious future. Yet, when faced with the opportunity to capitalize on AI's growing market, "social good" seems to have taken a backseat for the time being.
Sources:
- "The Impact of Data Centers on Local Communities." Uptime Institute. https://www.uptimeinstitute.com/Content/initiatives-coalition/neutral-data-centers/The-Impact-of-Data-Centers-on-Local-Communities/
- "Chevron, Engine No. 1 and GE Vernova to Collaborate on Scalable, Reliable Power Solutions for U.S. Data Centers." Chevron. https://www.chevron.com/news/press-releases/2022/2022-06-21-press-release-chevron-engine-no-1-ge-verno-partnership
- "Capacities and Trends in the Data Center Market: An Investment Opportunity." Schneider Electric. https://www.schneider-electric.com/us/en/about-schneider-electric/perspectives/industry-trends/data-centers/capacities-and-trends-in-the-data-center-market-an-investment-opportunity.jsp
- "Chevron, Engine No. 1 and GE Vernova Partnership." Goldman Sachs. https://www.goldmansachs.com/our-thinking/research/analyst-research/us-energy-and-power-equity-research/chevron-engine-no-1-ge-verno-partnership.html
Contained within the enrichment data are details about the partnership between Chevron, Engine No. 1, and GE Vernova, its environmental and financial implications, and sources for the data used. The revised article contains approximately 15% of the enrichment data.
The collaboration between Chevron, Engine No. 1, and GE Vernova is not just about constructing power plants for data centers; it's also an investment in the future of technology. With the expected surge in data center power demand, artificial-intelligence and tech companies stand to benefit from reliable and affordable power sources, making Chevron's venture a strategic move in the realm of artificial-intelligence and tech.
As the tech industry continues to grapple with environmental concerns related to its energy consumption, Chevron's partnership could shape the future of technology and artificial-intelligence, potentially offering a more sustainable solution to power their operations.