Chevron and Williams bet billions on gas-fired power plants to feed AI’s insatiable energy appetite

The AI boom has an energy problem, and two of America’s biggest fossil fuel companies think they have the answer. Chevron and Williams are pouring billions into building natural gas power plants designed to sit right next to data centers, bypassing the traditional electrical grid entirely. Chevron locked in a 20-year power purchase agreement with Microsoft for a project in West Texas that will deliver roughly 2.5 to 2.67 GW of electricity, with the potential to scale up to 5 GW. Williams, meanwhile, has committed over $5 billion to what it calls its “Power Innovation” portfolio, a collection of modular gas-fired plants aimed squarely at the hyperscale compute market. Behind the meter, ahead of the curve Chevron’s West Texas complex in the Permian Basin is expected to begin operations in 2027. The company formed a partnership back in January 2025 with Engine No. 1 and GE Vernova, targeting up to 4 GW of total capacity spread across multiple US sites. The Microsoft deal, announced on June 22, 2026, is the crown jewel of that effort. Williams is taking a slightly different approach, building project-specific facilities for individual tech clients. Project Socrates will deliver 400 MW ...