{"id":78,"date":"2026-05-20T14:38:45","date_gmt":"2026-05-20T14:38:45","guid":{"rendered":"https:\/\/movingandmortgagehub.com\/?p=78"},"modified":"2026-05-20T14:38:45","modified_gmt":"2026-05-20T14:38:45","slug":"chevron-seeks-huge-tax-break-to-build-a-power-plant-for-a-texas-data-center","status":"publish","type":"post","link":"https:\/\/movingandmortgagehub.com\/?p=78","title":{"rendered":"Chevron Seeks Huge Tax Break to Build a Power Plant for a Texas Data Center"},"content":{"rendered":"
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This story was originally published by\u00a0<\/em>WIRED\u00a0and\u00a0is reproduced here as part of the\u00a0<\/em>Climate Desk\u00a0collaboration.<\/em><\/p>

Read more Who Is Eligible for Trump\u2019s Slush Fund Money? Blanche Won\u2019t Say.<\/a><\/p>\n

A major oil<\/span>\u00a0company is seeking a state tax break in Texas worth hundreds of millions of dollars to build a massive power plant. The energy won\u2019t be going to residential customers, though. Instead, the gas plant will be used to power a data center whose eventual tenant could be Microsoft.<\/p>\n

Chevron subsidiary Energy Forge One has\u00a0filed an application\u00a0with the State Comptroller\u2019s board to obtain a tax abatement for a power plant it\u2019s building in West Texas. In late January, the comptroller\u2019s office made a recommendation to support the application\u2019s approval\u2014the first such approval under the program for a power plant intended solely for data center use.<\/p>\n

In March, following\u00a0news reports\u00a0that Microsoft was looking into purchasing power from the Energy Forge project, Chevron\u00a0said\u00a0that it had entered into an \u201cexclusivity agreement\u201d with Microsoft and Engine 1, an investment fund involved in the project. In January, Microsoft pledged to be a \u201cgood neighbor\u201d in communities where it is building data centers, including promising to pay a \u201cfull and fair share of local property taxes.\u201dThe potential tax abatement for the project comes as big tech companies are battling rising public fury about data centers and electricity costs. It also comes as lawmakers start to cast a more critical eye on ballooning incentives for data centers, some of which have cost some states\u2014including Texas\u2014$1 billion or more each year.<\/p>\n

Chevron spokesperson Paula Beasley told WIRED<\/em> in an email that all tax incentives under consideration for the Energy Forge project \u201capply solely to the power generation facility\u201d to \u201csupport new energy infrastructure, and do not extend to any future data center facilities that may be served.\u201d Beasley also said that there is currently \u201cno definitive agreement\u201d with Microsoft for this power plant.<\/p>\n

\u201cMicrosoft is in discussions with Chevron,\u201d Rima Alaily, Microsoft\u2019s corporate vice president and general counsel for infrastructure, said in a statement to WIRED<\/em>. \u201cNo commercial terms have been finalized, and there is no definitive agreement at this time.\u201d<\/p>\n

Chevron is applying for a tax abatement for the project under Texas\u2019 Jobs, Energy, Technology, and Innovation (JETI) Act. Passed in 2023, the program is intended to incentivize businesses to build large infrastructure projects in the state in exchange for guarantees to bring jobs and revenue. Accepted projects get a cap set on the amount of taxable property they can be charged through local school district taxes.<\/p>\n

The Pecos-Barstow-Toyah school board\u00a0approved\u00a0the project\u2019s application at a meeting in February. The state pays for the tax abatement, so the school district itself does not lose out on any money.<\/p>\n

According to documents from the state, the Chevron project could net more than $227 million in savings for the company over a 10-year period, depending on the eventual size of the project and investment. The application\u00a0\u00a0the plant will provide \u201cover 25 permanent, full-time jobs,\u201d though there\u2019s no requirement to do so because it\u2019s considered an electricity generation facility.<\/p>\n

The planned gas plant won\u2019t connect to the grid, instead providing \u201celectricity for direct consumption by a data center,\u201d according to its application. So-called behind-the-meter gas plants have become increasingly popular for data center developers facing yearslong waits to connect to the grid. According to data from nonprofit Global Energy Monitor, the US at the start of the year had\u00a0nearly 100 gigawatts of gas-fired power\u00a0in the development pipeline solely to power data centers, with several more massive gas projects announced since the data was published.<\/p>\n

A\u00a0WIRED<\/em> analysis\u00a0of less than a dozen power plants being constructed to explicitly serve data centers, including the Chevron project, found that these power plants are permitted to emit more greenhouse gases than many small- to medium-size countries. The Energy Forge plant alone could emit more than 11.5 million tons of CO2\u00a0equivalent annually\u2014more than the country of Jamaica emitted in 2024. Beasley told WIRED<\/em> that the plant \u201cis being designed to comply with applicable environmental regulations, including all applicable federal and state air quality standards.\u201d<\/p>\n

West Texas is a major fossil fuel production hub, which has helped it emerge as a hot spot for both data centers and behind-the-meter gas development. However, Energy Forge\u2019s JETI application notes that the site is one of six across the US under consideration. Without tax incentives, the other sites would be \u201cmore attractive locations\u201d to build a gas plant, according to its application, and \u201cTexas would lose the opportunity to attract billions of dollars in new tax revenues.\u201d<\/p>

Read more Supreme Court Reinstates Access to Abortion Pills\u2014For Now<\/a><\/p>\n

This type of claim on applications for tax abatements is pretty routine, says Nathan Jensen, a government professor at the University of Texas at Austin. An earlier version of the JETI program, originally created to draw more manufacturing jobs to Texas, handed out incentives to businesses with little oversight, often giving millions in tax breaks to companies already planning on building in the state. While the JETI program significantly curbs the problems and excesses of the old program, Jensen says that the guardrails for a project like Chevron\u2019s are still relatively low.<\/p>\n

The JETI tax incentive isn\u2019t the only tax break the power plant could receive. According to county documents, the Energy Forge project could also be eligible for a local incentive that exempts all or part of a property\u2019s value from taxes for up to a decade, under another part of the Texas tax code.<\/p>\n

Developers have taken advantage of other tax abatements across the US. A\u00a0report\u00a0released in April from Good Jobs First, a corporate watchdog group, found that at least three states\u2014including Texas\u2014are losing more than $1 billion in revenue each year from data center sales tax abatements.<\/p>\n

A bipartisan group of politicians in Texas, including Republican lieutenant governor Dan Patrick, have expressed mounting concern about the impact tax breaks for data centers are having on state coffers. In March, Patrick\u00a0\u00a0the legislature to \u201cstudy the cost and consequences\u201d of the sales tax exemption\u2014which the state projects could balloon to $3 billion by 2029\u2014and \u201cmake recommendations providing safeguards to ensure that Texans benefit from data center investment.\u201d<\/p>\n

In January, Microsoft rolled out a series of pledges on its website, promising to \u201cadd to the tax base\u201d in communities where it operates. \u201cWe won\u2019t ask local municipalities to reduce their local property tax rates when we buy land or propose a data center presence,\u201d the\u00a0pledge states. The company did not respond to questions about whether this pledge extends to projects owned by other entities that the company intends to use to power its data centers, or to data center developers that may be building data centers in which Microsoft will be a tenant.<\/p>\n

Greg LeRoy, the executive director of Good Jobs First, notes that Microsoft\u2019s pledge doesn\u2019t mention tax abatements (the amount of value a person or business\u2019s property is assessed at), which are different from tax rates (the number used to calculate the amount of taxes owed for the property).<\/p>\n

\u201cIf they don\u2019t say, \u2018We will refuse tax abatements,\u2019 then they\u2019ve got their fingers crossed behind their back,\u201d LeRoy says of Microsoft\u2019s pledge.<\/p>\n

Tax breaks given to projects like data centers are difficult to track across states: the Good Jobs First report found that 14 states don\u2019t disclose how much revenue they might be losing on data center abatements. As behind-the-meter power becomes an increasingly popular option for data center developers, though, it\u2019s not clear how widespread the practice of asking for tax abatements for these specific facilities is.<\/p>\n

There are no other behind-the-meter power plants currently being funded by the Texas JETI program or in the application pipeline. Data centers are\u00a0specifically excluded\u00a0from being eligible for the JETI program.<\/p>\n

Jane Flegal, a senior fellow at the Searchlight Institute and a climate official under President Biden, is the author of a recent\u00a0report\u00a0that suggests ways to use the AI boom to incentivize tech companies to help pay for needed upgrades to the grid. Tax abatements, the report says, should be restructured to make sure that data center builders connect power to the grid, making behind-the-meter gas options less attractive. Flegal also advocates for permitting reform to make sure that more clean energy can get added to the grid as quickly as possible.<\/p>\n

\u201cWe should fix our tax code so it\u2019s much more progressive, and we should tax the shit out of these people and use federal money to plan and build a grid that benefits all of us,\u201d she says. \u201cAlas, that is not where we are.\u201d<\/p>

Read more Trump Officials, Billionaires and the Quiet Reshaping of America\u2019s Public Lands<\/a><\/p>\n<\/article>","protected":false},"excerpt":{"rendered":"

It would emit more CO2 than the entire nation of Jamaica.<\/p>\n","protected":false},"author":1,"featured_media":76,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[4],"tags":[],"class_list":["post-78","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-environment"],"yoast_head":"\nChevron Seeks Huge Tax Break to Build a Power Plant for a Texas Data Center - Moving and Mortgage Hub<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/movingandmortgagehub.com\/?p=78\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Chevron Seeks Huge Tax Break to Build a Power Plant for a Texas Data Center - Moving and Mortgage Hub\" \/>\n<meta property=\"og:description\" content=\"It would emit more CO2 than the entire nation of Jamaica.\" \/>\n<meta property=\"og:url\" content=\"https:\/\/movingandmortgagehub.com\/?p=78\" \/>\n<meta property=\"og:site_name\" content=\"Moving and Mortgage Hub\" \/>\n<meta property=\"article:published_time\" content=\"2026-05-20T14:38:45+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/movingandmortgagehub.com\/wp-content\/uploads\/2026\/05\/d3ded595af648bafc5865d62b5393b2f.webp\" \/>\n\t<meta property=\"og:image:width\" content=\"1200\" \/>\n\t<meta property=\"og:image:height\" content=\"630\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/webp\" \/>\n<meta name=\"author\" content=\"admin\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"admin\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"7 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\\\/\\\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\\\/\\\/movingandmortgagehub.com\\\/?p=78#article\",\"isPartOf\":{\"@id\":\"https:\\\/\\\/movingandmortgagehub.com\\\/?p=78\"},\"author\":{\"name\":\"admin\",\"@id\":\"https:\\\/\\\/movingandmortgagehub.com\\\/#\\\/schema\\\/person\\\/6b7c79bcfd888d98f34c5413df7e81a2\"},\"headline\":\"Chevron Seeks Huge Tax Break to Build a Power Plant for a Texas Data Center\",\"datePublished\":\"2026-05-20T14:38:45+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\\\/\\\/movingandmortgagehub.com\\\/?p=78\"},\"wordCount\":1500,\"commentCount\":0,\"image\":{\"@id\":\"https:\\\/\\\/movingandmortgagehub.com\\\/?p=78#primaryimage\"},\"thumbnailUrl\":\"https:\\\/\\\/movingandmortgagehub.com\\\/wp-content\\\/uploads\\\/2026\\\/05\\\/d3ded595af648bafc5865d62b5393b2f.webp\",\"articleSection\":[\"Environment\"],\"inLanguage\":\"en-US\",\"potentialAction\":[{\"@type\":\"CommentAction\",\"name\":\"Comment\",\"target\":[\"https:\\\/\\\/movingandmortgagehub.com\\\/?p=78#respond\"]}]},{\"@type\":\"WebPage\",\"@id\":\"https:\\\/\\\/movingandmortgagehub.com\\\/?p=78\",\"url\":\"https:\\\/\\\/movingandmortgagehub.com\\\/?p=78\",\"name\":\"Chevron Seeks Huge Tax Break to Build a Power Plant for a Texas Data Center - 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