Pipeline Firms in Talks With Data Centers on Direct Gas Supply
Energy Transfer and Williams Companies are reportedly in discussions with data centers that want to generate power on-site.
August 9, 2024
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(Bloomberg) -- Pipeline giants Energy Transfer and Williams Companies are talking to data center operators about building pipelines directly to their facilities to fuel on-site power plants as the centers prepare for a boom in artificial intelligence.
Utilities are bracing for the largest increase in power demand in a generation due to data centers for AI, computer-chip factories, and a growing number of electric vehicles.
Some of that additional power will come from wind and solar. But a significant portion will be from gas-fired plants. And companies that run data centers want to make sure that that gas will be available — and quickly obtainable – when they need it.
Energy Transfer is in discussions with data centers of different sizes, many of which want to generate power on-site, co-chief executive officer Marshall McCrea said in a call with analysts Wednesday afternoon.
“It’s an enormous opportunity for us,” McCrea said.
Energy Transfer is pursuing expansions at currently connected plants and is in discussions to serve power plants with new connections, according to a company presentation.
Rival pipeline company Williams is also in talks to direct supply gas to data centers, particularly in the southeastern part of the US and the mid-Atlantic.
“We, frankly, are kind of overwhelmed with the number of requests that we’re dealing with, and we are trying to make sense of those projects,” chief executive officer Alan Armstrong said on a call with analysts this week.
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