Natural gas capacity surges to power U.S. AI data centers

The rapid expansion of artificial intelligence and cloud computing is driving a significant surge in electricity demand across the United States, particularly within major data center hubs. According to Global Energy Monitor, U.S. gas-fired generating capacity under construction reached 52 gigawatts by mid-2026, a 76 percent increase in six months. Approximately 16.9 gigawatts of this capacity is being built specifically to power data centers, as companies increasingly develop on-site power plants to bypass electrical grid connection delays.

Texas is a primary driver of this trend, accounting for nearly one-third of the U.S. project pipeline with 122 gigawatts of gas-fired capacity in development. Within Texas, 77 gigawatts of that capacity is intended to directly support data centers.

The U.S. Energy Information Administration (EIA) has modeled high-demand scenarios where electricity demand grows 50 percent faster than baseline forecasts in major data center regions. In such a scenario, natural gas would supply the majority of additional electricity because of the long lead times required to build new plants. This could result in a 7.3 percent increase in natural gas generation—roughly 123 billion kilowatt-hours—between 2025 and 2027. In the ERCOT region of Texas, such high demand could potentially drive average wholesale electricity prices up by $37 per megawatt-hour, or 79 percent, by 2027.