By 2035, US data centers are projected to consume more natural gas than the combined total of Germany and Japan, driven by escalating demand linked to AI infrastructure growth and onsite power generation.
- US data centers' natural gas use could reach 18 billion cubic feet daily by 2035.
- Onsite natural gas power plants from tech giants will double current data center gas consumption.
- Increased demand may raise natural gas prices and boost US greenhouse gas emissions by 12%.
What happened
The rapid growth of artificial intelligence technology has accelerated data center expansion across the United States, leading to a sharp increase in natural gas consumption. According to a recent BloombergNEF report, US data centers could consume approximately 18 billion cubic feet of natural gas per day by 2035. This is nearly twice the amount forecasted less than a year ago and surpasses the total consumption of both Germany and Japan combined.
This surge includes a significant rise in onsite natural gas power generation, with companies like Meta, Microsoft, Google, and Amazon investing in dedicated natural gas plants to power their facilities independently of the grid. These onsite plants alone are expected to consume 2.9 to 3.4 billion cubic feet per day by 2035, matching current total data center consumption, while grid-connected data centers will drive further demand growth.
Why it matters
This unprecedented growth in natural gas demand from data centers is poised to become the second-largest driver of gas consumption in the US after liquefied natural gas (LNG) exports. The added demand may create upward pressure on natural gas prices, affecting utility ratepayers and energy markets that have so far benefited from stable prices.
The environmental impact is substantial as well. Burning natural gas carries a significant carbon footprint, including emissions from extraction, processing, and distribution. Increased consumption by data centers could add roughly 1 million metric tons of greenhouse gases daily, equivalent to about 12% of current US emissions, complicating efforts to meet climate targets.
What to watch next
Stakeholders should monitor the buildout pace and completion rates of announced data center projects, especially those involving onsite natural gas power plants, as these will determine actual future demand. Changes in natural gas prices will also influence the feasibility of ongoing expansion plans and technology adoption.
Regulatory responses to the mounting environmental impact will be critical. There may be increased scrutiny on data centers' energy sourcing and emissions mitigation strategies, particularly given the potential conflict with national and corporate sustainability goals. Advances in alternative energy integration or efficiency measures could shift this trajectory.