Pacific Gas and Electric Company (PG&E) has recorded a significant uptick in the capacity of electricity required for new data centers seeking a grid connection.

The Californian utility reported that it expects new data centers to require around 8.7GW of power over the next ten years. This represents a marked increase from the end of 2024, where the utility projected that it would require 5.5GW of electricity.

Of the 8.7GW of new capacity, 1.4GW, representing 18 data center projects, is in the final engineering phase - the final step before construction can commence. These data centers are all projected to reach operational status between 2026 and 2030, with the majority located in Silicon Valley, the San Francisco Bay Area, the Central Valley, and the city of Sacramento.

PG&E has said that the new capacity will act as a net positive for other ratepayers. The utility estimates that for every 1GW of new demand from data centers, other customers across its footprint could see their monthly bill fall by between one and two percent.

“What differentiates the opportunity for data centers in California is a diversified set of customers and projects, excess clean power supply, and a regulatory approach which ensures that our existing residential customers will save money,” said Mike Medeiros, VP, South Bay Delivery, PG&E

In addition, PG&E has announced that it has commenced a follow-up study across its entire service area to study the needs of data centers. Its service area spans 70,000 square miles across northern and central California.

The utility also reported that it had received a further 21 data center project applications through its follow-up cluster study, which was launched in April. The data centers have a combined capacity of around 4.1GW, with PG&E expected to scope and finalize the requests by the year's end. The company claims that through clustering, it can plan better, save money, and permit a much faster connection time for customers.

Late last year, the utility announced that it would develop three data centers in San Jose, totaling 200MW. The project, which is being developed in partnership with real estate firm Westbank, aims to create a net-zero community. The project will see excess heat from the three data centers harnessed through a district heating system to heat and cool surrounding buildings. The partners have begun the upgrades on the infrastructure to facilitate the project and are now looking for data center partners to join the project.