Xcel Energy announced partnerships with NextEra Energy and GE Vernova on Thursday as it seeks to speed its development of new generation to serve growing data center interest.
With a newly signed deal in the Upper Midwest, Xcel Energy now has more than 2 GW of contracted data center capacity in queue, and expects to sign another gigawatt of capacity in 2026, CEO Bob Frenzel said during an earnings call Thursday.
But the real potential, he said, is in the company's long-term opportunities. Xcel now expects to have 6 GW of contracted data centers in queue by 2027 — twice what it anticipated last October. Even greater growth may be possible beyond 2030, when Frenzel said he expects the largest data centers to come online.
To accommodate this growth without impacting existing customers, Frenzel said Xcel has proposed new large load tariffs in Minnesota, Wisconsin, Colorado and Texas, and may pursue additional large load tariffs elsewhere within its service territory.
The new partnerships with NextEra and GE Vernova will also help the company execute on its data center goals, Frenzel said. Though not yet finalized, he said the deal with NextEra will focus on co-developing generation and transmission to serve data center projects and hubs within the Xcel Energy service territory.
“We do think there will be increased clock speed as we think through combining two of the best sales teams, two of the best development teams, two of the best analytical teams in the country to deliver solutions for a very sophisticated customer set,” Frenzel said of the NextEra partnership.
The agreement with GE Vernova will support wind, natural gas and transmission projects through the 2030s, Frenzel said, beginning with the provision of at least five new natural gas turbines and equipment for “several gigawatts of wind projects.”
Although the company's base $60-billion five-year capital plan will remain unchanged through the third quarter of this year per company norms, Xcel Energy has already identified some $10 billion in additional infrastructure investment opportunities, Frenzel said. Those additional opportunities include a $1.5-billion, 765 kV transmission line Xcel Energy was awarded this week to build for the Southwest Power Pool, according to Brian Van Abel, executive vice president and chief financial officer for Xcel Energy.
The company also increased its estimated liability from the 2021 Marshall Wildfire in Colorado to $430 million, Van Abel said — just shy of the company's $500 million insurance limit.
Company leaders on Thursday's earnings call did not discuss a lawsuit filed in late December by Texas Attorney General Ken Paxton alleging neglected Xcel Energy power lines caused the Smokehouse Creek Fire in 2024.
