PG&E Expects Goldilocks Growth to Reduce Customer Bills by 2027

Pacific Gas & Electric (PG&E) expects growth in data center projects to reduce customer rates by 2027. The company has lined up 10 GW of data center projects, with about 1.3 GW added in Q2, and has over 50 projects in its queue. PG&E aims to attract both smaller and larger customers, including a 90-MW deal with Microsoft. The company does not plan to issue additional equity to fund its $63 billion capital plan, despite pending state legislation on wildfire mitigation and bill affordability.

Pacific Gas & Electric (PG&E) has announced significant growth in data center projects, aiming to reduce customer rates by 2027. The company has lined up 10 gigawatts (GW) of data center projects, with about 1.3 GW added in the second quarter. This growth is part of PG&E's broader strategy to attract both smaller and larger customers, including a 90-megawatt (MW) deal with Microsoft [1].

PG&E's CEO, Patti Poppe, highlighted that the company's diverse set of projects ensures a robust development pipeline, reducing reliance on a single location or counterparty. This growth is expected to bring about rate benefits for customers as early as 2027. Poppe estimated that every 1 GW of additional load growth will decrease customer bills by 1% to 2% [1].

In addition to data centers, PG&E is also pursuing large electric loads from warehouses, electric vehicle fleets, and manufacturing. The company's interim implementation of Electric Rule 30 by the California Public Utilities Commission (CPUC) streamlines the process for grid connections, enabling faster development of these projects [2].

PG&E's capital plan, totaling $63 billion over five years, does not require additional equity, despite pending state legislation on wildfire mitigation and bill affordability. The company plans to file a new 10-year undergrounding plan by the end of the year, aiming to reduce vegetation management costs and improve wildfire mitigation [1].

The growth in data center demand is expected to create tens of thousands of jobs and generate significant local revenue. PG&E anticipates that this growth will lower electricity costs for all customers, with estimates suggesting a potential 10% or more reduction in customer electric bills by distributing fixed costs across a larger energy usage base [2].

References:
[1] https://www.utilitydive.com/news/pge-sees-goldilocks-growth-and-path-to-lower-bills-in-2027/756646/
[2] https://www.sierradailynews.com/state/pge-aims-for-10-gw-increase-in-electricity-demand-from-data-centers-to-boost-jobs-and-lower-bills