Data Centers Find a Green Ally in Fossil Fuels

ExxonMobil and Chevron are integrating carbon management into new power facilities designed to meet the rising energy demands of the tech sector

28 Jan 2026

The rapid expansion of artificial intelligence is reshaping the American energy landscape as oil majors pivot to provide low-carbon power for the digital infrastructure underpinning the tech boom. Rather than treating carbon capture, utilization, and storage as a secondary tool for emissions reduction, companies are now embedding the technology directly into integrated systems designed to meet the high reliability requirements of hyperscale data centers.

ExxonMobil has moved its integrated low-carbon data center project into the front-end engineering design stage, aiming for a final investment decision by late 2026. The proposed facility is designed to generate more than 1.5 gigawatts of off-grid electricity while capturing over 90 percent of its carbon dioxide emissions. Under the plan, the captured gas would be transported and stored permanently underground via the company’s Gulf Coast network, which currently holds agreements to sequester roughly 9 million tons of carbon dioxide annually. The project marks a shift in strategy — the first time a major American oil company has designed a power generation facility specifically for a third-party data center customer.

Chevron has adopted a similar strategy through a joint development announced in early 2025 with GE Vernova. The partnership aims to provide up to 4 gigawatts of co-located gas-fired power for data centers across the Southeast, Midwest, and West. These facilities, which the companies have described as “power foundries,” are being engineered with the flexibility to capture more than 90 percent of turbine emissions. Initial operations are slated for the end of 2027, with a final investment decision on the first gigawatt expected in the first half of next year.

The shift reflects an increasing digitalization of the carbon capture value chain. Operators are now embedding real-time process optimization and digital twin technologies into project architectures from the outset. Analysts with the IEA Greenhouse Gas Programme have noted that AI-driven optimization can reduce capture costs by 15 to 25 percent, while enhanced geological screening may cut the time required for storage site selection by half.

ExxonMobil estimates that data centers could eventually represent as much as 20 percent of the total addressable carbon capture market by 2050. As the tech industry’s hunger for electricity grows, the success of these capital-intensive projects will likely determine if carbon capture can move from a niche industrial application to a cornerstone of the modern power grid.