Xcel Energy says it will supply electricity to a new Google data center in Pine Island, Minnesota, and the deal includes nearly 2 gigawatts (GW) of clean energy and a 100-hour iron-air battery.
Nearly 2 GW of new clean power
The utility has signed an electric service agreement to power the data center, which will support core Google services such as Search, Maps, YouTube, and Workspace.
As part of the agreement, Xcel and Google plan to add 1,900 megawatts of new clean energy to the grid. That includes 1,400 MW of wind, 200 MW of solar, and 300 MW of long‑duration energy storage funded through a tariff created by Google and Xcel called a Clean Energy Accelerator Charge. The deal also includes Google investing $50 million in Xcel’s Capacity*Connect program, which will strengthen grid reliability.
The additional generation will push Xcel further beyond its current 70% carbon‑free electricity mix.
One standout piece of the plan is a 300‑MW iron‑air battery system from Form Energy. With about 30 gigawatt‑hours (GWh) of capacity and a duration of roughly 100 hours, it’s designed to store power for multiple days and release it when demand spikes. Xcel says it will be the largest battery project ever announced globally by energy capacity.
Who’s paying?
Xcel says existing customers won’t see higher rates because of the project. Under the agreement, Google will cover all costs of new infrastructure needed to serve the data center, consistent with Minnesota rules for large electricity users.
The utility says its Minnesota residential customers already pay relatively low power prices: over the past five years, average electric bills were 27% below the US national average. Since 2013, residential electric bills in the state have risen about 1.55% annually, which the company says is well below the inflation rate.
Why it matters
Large data centers are driving a surge in electricity demand across the US, especially as AI and cloud computing expand. Utilities and regulators are increasingly focused on how to add that demand without raising costs for existing customers or slowing clean energy progress.
If approved by regulators, this agreement could serve as a template for future utility–data center deals, requiring the Big Tech customer to fund grid upgrades and new generation tied to its load growth.
The agreement will be filed with the Minnesota Public Utilities Commission, which must formally approve it before electricity can be supplied to the site.
Read more: Google just spent $4.75B chasing power for AI data centers
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