By now, many people know that using generative AI tools leads to the consumption of tons of water. But if this is not enough for you, Chevron is ready to add negative side effects. According to The New York Times, the nation’s second-largest fossil fuel company is teaming up with an investment firm to build natural gas-fired power plants designed specifically to power data centers – just as the entire market is rethinking whether we really need to burn all those resources on artificial intelligence models.
According to the Times, Chevron is already ordering equipment and looking for potential locations for these power plants, which the company believes could be built and commissioned in as little as three years. According to Chevron CEO Mike Wirth, the plan is to “seize the moment and meet the growing need for reliable and affordable energy.”
The plan is also to make a profit while the money is flowing freely. A Goldman Sachs study shows that demand for data center electricity will grow by 160% by 2030, and companies that can get support quickly will get a bigger share of the estimated $500 billion that will be spent on expanding data center infrastructure. One could argue that this is an opportunistic move on Chevron’s part, as the company has been moving away from operating power plants in favor of the much more lucrative business of drilling and selling oil and gas. But suddenly becoming a source of electricity for companies that have free funds from venture capitalists seems like a good business.
However, Chevron probably could have chosen a better week to make the announcement. While the biggest U.S. players in artificial intelligence are mostly pushing the idea that AI will get better if we turn up the power, burn more energy, and eat more computing power, China’s DeepSeek has just released its own AI model that challenges the big tech’s offerings but costs half as much. So maybe we don’t have to mindlessly burn fossil fuels to meet the needs of AI waste factories.
Interestingly, Chevron’s pivot to AI energy seems to be partly due to the work of Engine No. 1, an activist investment firm that claims to be focused on social good. Previously, Engine No. 1 successfully tried to push Exxon Mobil toward a business model that would reduce the company’s carbon footprint and prioritize clean energy strategies in the future. But there is money to be made now. It turns out that the “social good” fades into the background when you can participate in the gold rush. We will all pay for the consequences later.
