The US is on the cusp of a boom in natural gas power plant construction as Big Tech turns to fossil fuels to fulfill the large electricity demands of the unreal intelligence revolution – threatening climate goals.
According to energy consultancy Enverus, as much as 80 latest gas-fired power plants will likely be in-built the US by 2030, adding 46 gigawatts of capability – the dimensions of Norway's power system and almost 20 percent greater than up to now five years.
The capability surge is anticipated to come back in the course of the second term of Donald Trump, who has vowed to maintain fossil fuels at the middle of the U.S. economy, signaling a reversal of previous forecasts for a decline in natural gas capability over the subsequent five years.
“Gas is definitely growing faster than ever now and within the medium term,” said Corianna Mah, research analyst at Enverus.
The expansion will threaten the Biden administration's climate goals, which called for greenhouse gas emissions to fall 50 to 52 percent from 2005 levels by the top of the last decade and for the grid to be 100% carbon-free by 2035.
“For natural gas to play a task in a decarbonized energy system, its emissions should be reduced as much as possible,” said Armond Cohen, executive director of the Clean Air Task Force, an environmental nonprofit.
U.S. gas-fired power plants emitted greater than 1 billion tons of carbon dioxide last 12 months, up nearly 4 percent in a 12 months and the best on record, in line with data from Ember, an energy think tank.
None of the planned gas-fired power plants pursued by Enverus will likely be equipped with carbon capture systems. While the Biden administration required latest facilities to include the technology starting in 2032, Trump is anticipated to eliminate or weaken the rule.
Wood Mackenzie and S&P Global Market Intelligence said overall U.S. capability growth could expand even faster, up 35 percent and 66 percent, respectively, over five years, compared with expansion over the past half-decade.
The gas boom comes because the U.S. competes with China to develop artificial intelligence and seeks to revive production lost in Asia in recent many years, triggering a historic surge in demand for reasonable electricity that may run uninterrupted.
Thanks to its huge shale reserves, the USA is already the most important natural gas producer on the planet. This helped keep domestic fuel prices relatively low even during Europe's energy crisis and supported the boom in sea exports.
Although clean energy supplies are also increasing within the U.S. — boosted by large subsidies under the Inflation Reduction Act — developers say intermittent renewables, even with latest batteries, are usually not yet enough to fulfill the needs of enormous consumers.
“Their ability to reliably serve the sort of load may be very limited with traditional renewables,” said Matt Bulpitt, vice chairman of energy development at Entergy, a serious utility within the South.
In December, Entergy announced a $3.2 billion plan to construct three gas-fired power plants with a complete capability of two.3 GW to deal with Meta's $10 billion artificial intelligence data center, the tech company's largest handle. Meta will develop into Entergy's “largest single customer” once the middle is online, the utility told the Financial Times.
U.S. electricity consumption, known within the industry as “load,” is already at a record high but will rise one other 16 percent by 2029, in line with think tank Grid Strategies.
The U.S. Department of Energy expects the facility demand of knowledge centers used for artificial intelligence to triple over the subsequent three years.
The forecasts for such growth in gas production exceed previous forecasts. As recently as December 2023, the US Energy Information Administration expected a net decline in gas-fired power generation capability from 2025 to 2030, in line with an evaluation of EIA data shared with the FT by BloombergNEF.
Other corporations at the moment are trying to fulfill the US's gas needs.
“I wish I could have predicted it 18 months ago,” said Bill Newsom, chief executive of Mitsubishi Power Americas, a division of considered one of the world’s largest gas turbine makers. The company plans to speculate “a whole bunch of thousands and thousands” to expand its production capability by as much as 50 percent over the subsequent three years, Newsom told the FT.
Share prices of utilities and turbine manufacturers, including Siemens Energy and GE Vernova, have risen sharply over the past 12 months.
Major oil producers, including ExxonMobil and Chevron, are also moving into the business, designing facilities to directly power AI data centers without leaving the grid.
Some manufacturers retain aging gas assets, while others expand their size through acquisitions. Last 12 months, Wood Mackenzie revised down its expectations for total U.S. gas plant retirements in 2035 by 10 percent.
On Friday, Constellation Energy, considered one of the nation's largest electric utilities, said it’s buying Calpine, the most important independent gas producer, in a deal valued at nearly $27 billion, marking considered one of the most important deals in the facility sector.
According to S&P, Texas, Tennessee and South Carolina are leading the way in which in adding latest gas capability. The switch from coal to gas can be fueling this growth.
“Like everyone else on the planet, we wish renewable energy to catch up. We are all for the cleanest possible energy. The reality is that it would take an extended time to catch on,” said Bob Warden, managing director of personal equity firm Fortress Investment Group, which acquired 850 MW of mobile gas turbines earlier this week.
