Citi concerned PG&E datacenter potential demand ‘may not materialize’

Citi estimates that by 2029, PG&E (PCG) has about 3.4 GW of datacenter load in the engineering study phase and cites CEC data that show PG&E has an incremental 1.5GW datacenter load in the engineering study phase from 2030 to 2040, putting its total potential datacenter load at about 5GW. However, following a California utility field trip, the firm is “more concerned” that the 5GW of PG&E datacenter potential demand “may not materialize” given fires, rate making, local opposition and reliability concerns. If the California datacenter buildout outlook slows, Citi’s telecom team believes this could help pricing, margins, and returns for existing facilities and new construction, so they remain buyers of Digital Realty (DLR) and Equinix (EQIX), the analyst added. Citi has a Buy rating on PG&E with a $21 price target.