When data centers with their own power generation are included, total gas consumption from the sector could reach about 18 billion cubic feet a day by the middle of the next decade. BloombergNEF estimates that on-site generation could account for between 2.9 billion and 3.4 billion cubic feet of that daily consumption.
The scale is significant compared with gas use elsewhere. The projected 15 billion cubic feet of additional grid-connected demand would exceed the current total consumption of most countries and would be more than five times the gas-demand growth BloombergNEF expects from all other grid-connected U.S. sectors combined through 2035.
Data centers are expected to become the second-largest source of U.S. natural gas demand growth during the period, behind liquefied natural gas exports.
The power infrastructure needed to meet that demand is also expanding. Moody’s estimates that more than 30 gigawatts of additional gas-fired generation will be required as electricity consumption rises, as part of a broader power-plant buildout estimated at $110 billion.
Orders for gas turbines have already reached their highest level since 2000, according to S&P Global, with data-center electricity demand contributing to the increase.
Some technology companies are also pursuing power plants dedicated directly to their data centers rather than relying entirely on the electrical grid. Meta, Microsoft, Google and Amazon have announced projects involving natural gas generation that can supply facilities outside conventional grid arrangements.
That approach can provide data centers with the steady electricity required to operate around the clock, particularly while new grid projects face lengthy development and interconnection processes. But it also creates additional emissions from infrastructure that could remain in operation for decades.
Bloomberg reporting has estimated that proposed gas plants associated with data centers could increase emissions from the U.S. power sector by 20%.
The broader climate impact depends on how much of the projected demand ultimately materializes and how the electricity is generated. Burning natural gas produces carbon dioxide, while emissions also occur during extraction, processing and distribution. Based on the additional gas consumption projected for data centers, the resulting greenhouse gas emissions could reach roughly 1 million metric tons per day.
The increase could have consequences beyond emissions. Much of the current data-center expansion has been planned during a period of relatively stable natural gas prices. Rising consumption from both data centers and LNG exports could put additional pressure on gas prices, potentially affecting utilities and their customers as well as technology companies.
At the same time, efficiency improvements in AI hardware could moderate some electricity demand. The forecasts cited in the analysis, however, still anticipate substantial growth in gas consumption even as computing technology becomes more efficient.
The projections put greater attention on how technology companies account for the electricity behind their AI infrastructure. That includes Scope 2 emissions associated with purchased power, renewable-energy procurement and the emissions profile of data centers that build dedicated generation.
With tens of gigawatts of new power capacity potentially required, decisions being made during the current data-center construction cycle could determine how much of AI’s growing electricity demand is supplied by natural gas through the next decade.
This analysis is based on reporting from Gadget Review.
Image courtesy of Tetra Tech.
This article was generated with AI assistance and reviewed for accuracy and quality.
