Report: US Data Centers on Track to Burn More Natural Gas Than Germany and Japan Combined by 2035

The race to build AI infrastructure has reached a point where, by 2035, U.S. data centers are projected to consume more natural gas than Germany and Japan combined, according to a BloombergNEF report.

Over the next decade, data centers are expected to rank second only to LNG exports as a driver of natural gas demand growth. The facilities could burn roughly 18 billion cubic feet per day - nearly double what BloombergNEF forecast just nine months ago. The revised figure accounts for the likelihood that not every announced project gets built.

Onsite power plants for data centers have drawn attention lately, with Meta, Microsoft, Google, and Amazon all unveiling plans for natural gas plants that sidestep the grid. Such projects are expected to use 2.9 billion to 3.4 billion cubic feet per day by 2035 - about equal to what all data centers consume today, including gas burned to generate grid power.

Still, BloombergNEF says onsite-powered facilities may account for only a slice of the growth. Grid-connected data centers are predicted to add 15 billion cubic feet per day of gas demand from the power sector by the middle of the next decade - five times more demand growth through 2035 than all other grid-connected sectors combined.

If that demand materializes, natural gas prices could climb. Much of the current buildout assumes the stable prices of recent years, but analysts at Noreva warn that the combined pressure of data centers and rising LNG exports could send prices soaring. Tech companies might absorb the increase; utility ratepayers may not.

There is also the climate cost. Burning one cubic foot of natural gas releases the equivalent of 60 grams of carbon dioxide, counting extraction, processing, and distribution, per the IEA. The added data center demand would produce 1 million metric tons more greenhouse gas pollution daily - roughly 12% of total U.S. greenhouse gas emissions today.

Source: TechCrunch