Data center need for speed increases demand for natural gas

Data centers have been around for around two decades now with an estimated 4,000-5,000 currently in operation in the U.S. However, the size and scale of what are being built today are much larger than those of the early days.  The impact of the new version of these power hungry sources of demand is shifting the location and their individual energy sourcing strategies.  A standard AI facility being developed these days talk in terms of 1 GW each with a top tier data center campus requiring 6-10 GW each.  To give you an idea of just how much energy we’re talking about, Cleanview estimates that as of May 2026, the average capacity of the remaining coal generation fleet operating in the U.S. has a capacity of 0.875 MW each with the largest coal plants clustered around the 3-3.7 GW each. With an estimated 1,500 data centers being developed and/or under construction, the amount of power needed over the next five years to meet this demand is staggering. 

Just 3-5 years ago, having a renewable source of power supply, was an absolute requirement by most AI developers and owners. However, there has been a shift from required to desired over the past several years which has been prompted by the long interconnection queue timelines and complicated by growing state level concerns of cost and reliability on existing users. Speed to market has become the priority and with no plans for new coal fired plants being built, the data center need for speed has targeted natural gas as the next best alternative with a trend to generate that power on-site using natural gas as the fuel to meet that priority.  Since significant amounts of natural gas and the necessary pipeline capacity to deliver the large amount of natural gas doesn’t exist everywhere, the concept of matching utility scale co-located generation needed at a data center with the availability of the natural gas supply to feed it is seeing a few states rise to the top as potential sites, with the largest giga scale facilities progressing in specific areas. There are a handful of very large projects that stand out, which are clustered regionally in Texas, along the Gulf Coast and in Appalachia.  It is not a coincidence that growth has expanded beyond the traditional data center alley of Northern Virginia and Silicon Valley in Northern California as these two states are already the largest importers of power in the country and now struggling to meet growing demand.

The map below highlights nine major data center projects under development with a higher degree of success under a shorter timeline. 

There are a few items in common with the hottest data center locations being developed and those benefits include a shorter timeline to be online which is being driven by access to natural gas supplies and pipeline infrastructure, larger availability of land outside the typical urban environments of historical trends and within states that have more favorable legislative frameworks. 

The nine projects in the table above would consume an estimated 7.8 Bcf per day of natural gas, which is something very few other areas in the country can provide under the much shorter timelines desired by  these mammoth projects and a primary reason why those locations were chosen.