Meta Platforms (META.US) enters the electricity trading market by betting on long-term power purchase agreements to accelerate the construction of AI data center power supply.

According to reports, Meta Platforms (META.US) is entering the market of American Electric Power Company, Inc., attempting to accelerate the construction of new power plants to support its artificial intelligence needs through direct participation in electricity trading. The report states that Meta's move stems from concerns the company heard from investors and power plant developers, that there are too few buyers willing to sign long-term power purchase agreements early on, and these long-term commitments are a key factor in attracting investment in new power plants. To address this market pain point, Meta plans to become a long-term demand side for electricity. Urvi Parekh, Global Head of Energy at Meta, stated that engaging in electricity trading will provide the company with greater flexibility, enabling it to sign longer-term contracts with power generators, thereby helping projects to secure construction funding. She also revealed that Meta plans to first learn about electricity trading through external partners, before attempting to enter the electricity market independently. Meta's move highlights the profound changes occurring in the U.S. Energy Corp. and the power market. With tech giants competing to develop more advanced AI systems, the demand for electricity is increasing, and data center power consumption is becoming a new focus of growth. It is predicted that in the next ten years, the power demand for training and operating AI models in data centers will quadruple. Currently, Meta has not disclosed a timeline for the launch of its electricity trading business, nor has it revealed more details about specific trading structures. However, it is widely believed within the industry that the direct involvement of large tech companies in power buying and trading will be a key force reshaping the future energy landscape of AI.