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Tech giant Microsoft has signed a global framework agreement to back renewable power projects that could be worth about $10 billion and buy the power that would be developed by Brookfield Asset Management, the Financial Times reported on Wednesday.
The agreement is for bringing around 10.5 gigawatts (GW) of solar and wind power between 2026 and 2030—a capacity that would cost over $10 billion to develop, according to recent industry trends, FT noted.
Microsoft’s deal with Brookfield Asset Management would be the biggest such corporate power purchase agreement and nearly three times bigger than the 3 GW of power that data centers in Virginia’s Eastern Loudoun County – dubbed Data Center Alley and the world’s “largest data center market” – currently consume, according to FT.
The surge in AI technologies and the massive build-out of data centers in America have had the biggest tech corporations scrambling for grid connection and reliable power supply to power the technologies of the future.
Most of the giant corporations want their power sources to be as clean as possible—preferably all renewable. But utilities are struggling to meet soaring demand from data centers while keeping reliable operations for all the customers in the areas they serve. As much as Amazon, Microsoft, and all other tech giants want solar and wind to power their operations, the lead times to new grid connections could be longer than they would like.
After more than a decade of flatlining power consumption in America, the AI boom and the chip and other tech manufacturing are leading to higher U.S. electricity demand.
So great is electricity consumption from data centers that U.S. utilities and regulators have raised significantly their forecasts for peak power demand in the coming decade.
For example, renewable energy giant NextEra Energy said in an investor presentation in March that the U.S. is experiencing exponential growth in demand for power, driven by a surge in demand from data centers.
Consulting firm Grid Strategies published a report earlier this year analyzing data from utilities’ regulatory findings. The analysis found that over the past year, grid planners nearly doubled the 5-year load growth forecast, the key drivers being investment in new manufacturing, industrial, and data center facilities.
