Chevron Taps GE Vernova to Build Power Plants for Data Centers

Chevron plans to build power plants in West Texas by 2027 to supply data centers. The move shows the oil giant branching out from its core business to capture rising electricity demand driven by AI.

Chevron (CVX) is taking its energy expertise in a new direction. The company said Wednesday it plans to begin deploying power plants to serve data centers in West Texas by 2027. The move marks a major step beyond oil and gas as the company looks to capture growth from the soaring demand for electricity tied to artificial intelligence.

Chevron outlined plans for multiple gigawatts of capacity by 2030. It is partnering with GE Vernova (GEV) and Engine No. 1 (SUPP) on the project and is in exclusive talks with a data center operator. A final investment decision is expected early next year.

The new business line could give investors another reason to pay attention. Powering data centers has become one of the most competitive segments in the energy industry as technology companies race to secure reliable, low-cost electricity. For Chevron, this expansion could change up how investors view the company, which is that it is not just as an oil producer but as a future power supplier to digital infrastructure

Chevron Builds Power for the Data Center Market

Chevron’s decision comes as electricity demand from data centers continues to climb. Many of these facilities operate around the clock to run AI models and cloud platforms. Energy companies are now positioning themselves as essential partners in that buildout.

Chevron’s advantage is its access to natural gas in the Permian Basin. The company can use those resources to generate power locally without major new exploration costs. Working with GE Vernova brings access to modern turbine technology and grid-scale systems. Engine No. 1 adds capital and operational experience, giving the project a blend of industrial and financial strength.

Chevron Balances Expansion with Spending Discipline

Chevron also told investors it remains focused on financial discipline. The company expects $18 billion to $21 billion in annual capital spending through 2030, which is a level that includes the integration of its Hess acquisition. Management said it can fund operations and dividends even if oil prices fall below $50 a barrel.

Chevron reaffirmed its plan to buy back $10 billion to $20 billion of stock each year, assuming oil prices stay between $60 and $80. This stability could appeal to investors who want exposure to the fast-growing data center power market without sacrificing dividend reliability.

Is Chevron’s CVX Stock a Good Buy?

Wall Street remains cautiously optimistic on Chevron. Out of 15 analysts covering the stock over the past three months, 11 rate it a Buy and four a Hold, with no Sell ratings.

The average 12-month CVX price target is $175, implying about 12% upside from the latest close.

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