The Zhitong Finance App learned that Microsoft (MSFT.US) is seeking to provide sufficient power supply to its data centers without relying on government subsidies or increasing the burden on other electricity consumers. As artificial intelligence (AI) infrastructure construction continues to expand, the huge energy demand for data centers is becoming a growing social and political concern in the US.
Noelle Walsh, president of Microsoft's cloud operations and innovation business, said at a conference in Houston: “We don't want other consumers to pay for our growth. We'll cover our own costs.”
Microsoft plans to invest 117 billion US dollars this year to build computing power infrastructure for AI and cloud computing services. As tech giants continue to expand the size of data centers, issues such as tight electricity supply, grid construction costs, and rising electricity bills for residents are causing more and more controversy.
Data center construction has even become one of the key topics in the US midterm elections this month. The election gave the Democratic Party control of Congress, and it also reflects that energy costs and the impact of large-scale technology projects on local communities are receiving more political attention.
As a long-term supporter of ChatGPT developer OpenAI, Microsoft has always emphasized that its data center construction follows the “community first” principle, that is, related projects should bring real benefits to local residents, rather than let the local community bear the negative impact of rising electricity costs and infrastructure expansion.
In this context, Microsoft is collaborating with energy giant Chevron (CVX.US) and investment company Engine No. 1 to develop a large-scale data center and power support project in western Texas called Project Kilby.
The project uses an independent supporting power supply model, that is, a special power generation facility is built near the data center to directly supply power to the data center to reduce dependence on the public power grid. This model is expected to help large technology companies meet growing demand for computing power while reducing the impact of data center expansion on other power users.
However, Project Kilby still faces regulatory hurdles. Previously, Texas Governor Greg Abbott (Greg Abbott) suspended approval of new data center projects, which prevented the development plan from progressing.
In the recent gubernatorial election, Abbott lost to Democratic candidate Gina Hinojosa. Notably, during the election campaign, Hinojosa indicated that it might take a more stringent approval stance on data center projects. This means that even if there is a change in state government leadership, related projects may still face greater policy uncertainty.
Despite this, Chevron plans to push ahead with the construction of Project Kilby according to the established schedule, aiming for initial operation in 2028 and full operation in 2031.
Jeff Gustavson, president of Chevron's new energy business, said that any project that fails to generate net revenue for the local community is bound to be difficult to succeed in the end. He stressed that Project Kilby is expected to create jobs in western Texas and bring stable tax revenue to the local government, so that data center construction not only serves the computing power needs of technology companies, but also creates long-term economic value for the local community.
As the scale of investment in AI infrastructure in the US continues to expand, how technology companies solve power supply problems is becoming a key factor affecting the smooth implementation of data center projects. Microsoft's commitment to bear its own energy costs and avoid passing on the additional burden to other consumers also highlights that large technology companies are trying to ease the energy and regulatory pressure caused by the AI construction boom by building their own supporting power supplies and strengthening community cooperation.