Key Points
- California utility PG&E plans to spend $73 billion on grid upgrades by 2030.
- The investment is needed to meet a surge in electricity demand from AI data centers.
- Power consumption is expected to reach record highs in the coming years, driven by the growth of AI.
- The upgrades are also part of PG&E’s effort to improve grid safety and prevent wildfires.
California utility PG&E announced on Monday it plans to spend a massive $73 billion by 2030 on transmission upgrades to keep up with the explosive, AI-driven demand for electricity from data centers. The move highlights the immense strain that the booming artificial intelligence industry is putting on the nation’s power grid.
The company had previously said it was preparing to serve 10 gigawatts of new electricity demand from data center projects over the next decade. U.S. power consumption is expected to reach record highs in the coming years, largely due to the substantial amount of energy required to power AI.
The huge investment is also part of PG&E’s ongoing effort to improve the reliability and safety of its grid.
The utility has been blamed for sparking numerous deadly wildfires in California and has been under pressure to modernize its infrastructure. Part of this plan includes burying nearly 700 miles of power lines to reduce wildfire risk.
In a separate but related development, PG&E also announced that its required contribution to the state’s wildfire fund will be significantly reduced. This change, resulting from a new state law, will provide the company with greater financial flexibility as it undertakes these extensive grid upgrades.
