Microsoft Solves AI’s Biggest Bottleneck With Chevron Deal

Microsoft and Chevron signed a 20-year power purchase agreement for Project Kilby, a 2.67-gigawatt natural gas plant in West Texas costing ~$7 billion with initial power targeted for 2028. This deal addresses AI infrastructure's critical power constraint, providing Microsoft with locked-in energy costs through 2048 and a competitive advantage over rivals relying on uncertain nuclear timelines. The agreement strengthens Microsoft's disciplined infrastructure execution and supports long-term Azure AI profitability.