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This might make sense for oil producers to get rid of their natural gas, which is nearly a waste material, but I'm struggling to understand how it makes sense for Microsoft. Despite the cheap natural gas, and an abundance of investors and builders with natural gas expertise, in the competitive electricity generation market everybody is deploying solar and batteries in west Texas because it's still more profitable than gas generation.

Further, there's a gas turbine shortage so Microsoft choosing to put their (presumably limited) allocation of gas turbines in West Texas, where they have good alternatives, seems a bit mysterious. Why not save that massive amount of turbines for the northeast DCs, where renewables work far poorer yet gas is more reliable?

The reasons that seem most convincing to me:

1. Political environment is hostile to renewables and Microsoft doesn't want to paint a target on their back by choosing solar plus batteries, the choice others are making in West Texas.

2. Grid connection drastically changes economics, but pipelines for gas are cheap or something, so the massive cost and delay from grid interconnection simply isn't worth it

3. There are particular political favors going on with Chevron, e.g. Chevron wants gas in the area and is willing to increase MS's turbine allocation if they do it in west Texas, or Chevron is helping get around pesky local political approvals for data centers, or something like that.

The cost of gas does not seem like a justification for this, though.

Profits still ain't easy.

Cheap gas is great, but 2.67GW of new build natural gas in this market will cost $6-8 billion in fixed costs. You need wholesale pricing of ~$50-60/MWh ... OVER 25 years! ... to recover just the fixed costs.

For West Texas, prices averaged mid-$30s over the last year.

Microsoft has all of the leverage here, and Chevron wants a big announcement in an area where they don't have a lot of experience.

Even corporate ESG policies bend the knee to cheap Texas energy!

To be fair, solar turbines has had the name since 1929 (they were then called solar aircraft company). It’s not like they’re being intentionally misleading.

Its easy, they are going to use fancy accounting to make it come true. Produce a ton of carbon, then buy a cheap, under-priced carbon credit to make it be a zero.

it's easy ... they'll just change the definition of "carbon negative"!

West Texas is like Costco for natural gas.

There are cases where the fields can produce more than the pipelines can carry away. If you put your gigantic gas turbines right next to the fields you can obtain access to some extremely cheap fuel. They might even pay you to burn it sometimes. Negative gas prices are a thing.

But they are using wind:

> A majority of the generation will come from large GE Vernova (NYSE: GEV) turbines.

Mostly it says that the oil business runs the show here in Texas, and in Washington.

While the US stays oil rich, we should expect the US to be a laggard in ending use of fossil fuels. China and EU are not oil rich, they’ll make a faster transition.

Of course it’s idiotic to actively hobble clean energy. Or to put your finger on the scale for one source of energy, like the current administration does.

But it’s not crazy to argue for “energy abundance” where the market just picks the cheapest energy on the market in the US and that just gradually moves cleaner over time.

Mhm... meteorological summer starts 1st of June. Solstice was yesterday as well.

Yeah, why would a governor be proud of pushing out two things that are unpopular with his constituents...

Newsom aside, the idea is to change from oil to non-oil, efficient from mono-industrial.. The US Oil minions claim to be blind to this and cite quarterly profits, again

Quick search shows the reason is nothing to do with your sarcasm.

Its origin is traced back to a 1929 company, Solar Aircraft Company.

https://en.wikipedia.org/wiki/Solar_Turbines

Solar Turbines is one of the world's leading manufacturers of industrial gas turbines, with more than 17,000 installed in 100 countries

Much like that scoundrel Aurelian reviving the cult of Sol Invictus to greenwash the late roman empire. /s

Very normal. Here in Europe (well nordics at least) pretty much all the capacity of any wind farm is already sold before construction begins. The PPA (power purchasing agreement) is usually pretty much required to get the loan/funding anyway.

Basically most projects start with the wind company using its own money to find a site and get it approved and then they go and try to find someone to sell the electricity to at a fixed rate before construction begins as selling directly to the spot market has way too much risk for the banks to give loans.

Not sure how different it is in Central Europe with solar as there isn’t much solar up here in the north (just doesn’t make much sense as during the 3 to 4 months in the winter when electricity price is at the yearly maximum you produce effectively nothing)

Many people. My house loan was 30 years. Commercial real estate is often 20. Commercial 30 year bonds are common.

Many investments won't pay off unless there is a 30 year plan so lots of investors work on that long term. Even if an investment pays off sooner you often are accounting better off longer terms - see an accountant