PG&E scales energy capabilities to address Northern and Central California data center demands
As data center providers continue to scale, new facilities will require a lot of power, and Pacific Gas and Electric Company (PG&E) says it’s ready to address that demand.
PG&E is working to serve approximately 5.5 gigawatts (GW) of new data center energy demand over the next decade.
Over half of the transmission requests that PG&E received in 2023-2024 have come from data centers. During this period, PG&E received 34 applications for transmission-level service with a demand of 4 MW or greater. The total combined load of the 34 applications is 4,440 MW.
The new 1.4 GW of data center load, which comes from 15 customers and represents 27 unique sites, is currently in final design and is projected to come online between 2026 and 2030.
PG&E said the new data center load expected to come online over the next five years includes 740 megawatts, which PG&E evaluated through its original cluster study in 2024, representing projects in Silicon Valley and the surrounding communities of the greater San Francisco Bay Area.
Focus on cost savings
A big focus for PG&E is to pass on cost savings to all its electric customers.
The utility estimates that for every 1,000 MW (or 1 GW) of new electric demand from the data centers it serves, PG&E electric customers may save between 1% and 2% on their monthly bill in the long term.
Further, PG&E's New energy demand from data centers allows PG&E to utilize more of its existing power infrastructure.
PG&E launched its cluster study to better respond to customers' needs when it comes to large loads like data centers. The study also aimed to more efficiently meet customers' energy needs and timelines. By grouping applications and projects together rather than individually, PG&E can more quickly confirm the demand and get these customers connected.
"PG&E is taking a thoughtful, deliberate process of pursuing load growth and we see a clear path to lowering customer bills as a result of adding what we call beneficial load," said Jason Glickman, executive vice president of engineering, Planning and Strategy, PG&E. "Electricity growth from data centers allows us to utilize our existing electric infrastructure better as we build what's needed and deliver more per customer dollar.”
Rule 30 Tariff
While data centers are PG&E's key motivation, the utility sees an opportunity to address new power loads sought by warehouses, electric vehicle fleets, and manufacturers.
As a result, PG&E recently submitted a proposal to the California Public Utilities Commission for a streamlined, transparent and equitable way to connect new electric retail transmission customers like data centers and large tech campuses.
In its Rule 30 tariff, which was presented to the California Public Utilities Commission (CPUC), PG&E defined the interconnection process, cost requirements, and how customers can recoup their up-front costs if load growth materializes. PG&E said the new tariff was modeled after existing rules for distribution customers.
"Our large load customers have asked for the ability to fund their projects upfront, which would help accelerate PG&E's ability to serve them, and Rule 30 proposes just that,” Glickman said. “The premise is to more efficiently and uniformly address these types of electric service requests and improve PG&E's ability to meet customers' requested in-service dates by enabling them to fund their projects upfront and get paid back after they come online.”
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Sean Buckley
Sean is responsible for establishing and executing the editorial strategies of Lightwave and Broadband Technology Report across their websites, email newsletters, events, and other information products.