Chevron Seeks Tax Break for Texas Power Plant Tied to Data Center

Chevron subsidiary Energy Forge One has filed an application with the State Comptroller’s board for a tax abatement to build a gas power plant in West Texas. The plant would supply electricity to a data center rather than residential customers. Officials in the comptroller’s office recommended approval of the application in January.

March, Chevron stated that it had entered into an exclusivity agreement with Microsoft and Engine 1, an investment fund involved in the project. The agreement followed reports that Microsoft was considering purchasing power from the Energy Forge plant. Microsoft pledged in January to pay a full and fair share of local property taxes in communities where it builds data centers.

The request comes as lawmakers examine incentives for data centers. Some programs have cost Texas more than $1 billion per year. Big tech companies face growing public questions about data center electricity use and costs.