HOUSTON (Reuters) - Chevron is advancing plans to tap into data center power demand, with the oil major recently entering the permitting and engineering phases for multiple U.S. sites to develop the centers and the electricity to supply them, a company executive told Reuters this week.

Big Tech has struck unprecedented power purchase deals to quickly access vast quantities of electricity, including buying directly from nuclear power plants and inking agreements with utilities to bring power generation to the grid.

That growth - and the need to access vast amounts of electricity fast - is upending the country’s power industry, which is seeing record peak demand after dismal growth over nearly two decades, and giving new rise to natural gas consumption.

And Big Oil is tapping into that growth. Chevron and Exxon Mobil last year announced plans to begin power generation, largely using the natural gas that they produce, for data centers for the first time. Most significant power generation by the oil majors has historically been used for their own operations.

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Many new data centers, which were typically around 20 gigawatts (GW), are being built 50 times their traditional size and requiring as much around-the-clock electricity at a single location as an entire mid-sized city.

Chevron is targeting the development of data center sites and power plants that are around 1 GW in capacity and targeted to come online in 2027 or 2028, Droog said.

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AI is just as power hungry as Bitcoin mining. AI is coming for natural gas. Big Oil is seeing an opportunity to capitalize here but makes me think another large sector of the American economy is getting sucked into the AI frenzy. I always ask myself what happens when the ROI on all this AI spend doesn’t materialize? The popping of the bubble will be devastating to the world economy. Everyone is placing huge bets on AI and I hope these bets pay off.