The artificial intelligence boom is no longer just a software story; it is rapidly becoming an energy crisis. A new report from BloombergNEF projects that by 2035, U.S. data centers will consume more natural gas than Germany and Japan combined. This forecast represents a staggering revision, nearly doubling the agency’s prediction from just nine months ago. The sheer scale of this demand places data centers as the second-largest driver of natural gas growth in the United States, trailing only liquefied natural gas (LNG) exports. We are looking at a potential daily consumption of 18 billion cubic feet, a figure that reshapes the entire energy landscape.
While headlines have focused on tech giants like Meta, Microsoft, Google, and Amazon building onsite natural gas power plants to bypass the grid, these facilities tell only part of the story. These onsite projects are expected to consume between 2.9 billion and 3.4 billion cubic feet per day by 2035. That alone matches the total natural gas usage of all data centers today. However, the real surge comes from grid-connected facilities. BloombergNEF predicts these will drive an additional 15 billion cubic feet per day in demand. To put that in perspective, this growth is five times larger than the combined demand increase from every other grid-connected sector through 2035.
This insatiable appetite for power threatens to upend market stability. Analysts at Noreva warn that the current era of stable natural gas prices may be a false hope. The dual pressure of exploding data center needs and rising LNG exports could cause prices to soar. While trillion-dollar tech companies might absorb higher energy costs, utility ratepayers likely cannot. The economic burden will shift downstream, potentially inflating electricity bills for households and businesses unrelated to the AI industry. This dynamic creates a fragile dependency where digital innovation relies on volatile fossil fuel markets.
The environmental cost is equally severe. Burning one cubic foot of natural gas releases approximately 60 grams of carbon dioxide, accounting for extraction and distribution. The projected increase in data center activity will generate an extra 1 million metric tons of greenhouse gas pollution every single day. That daily output equals about 12% of total U.S. greenhouse gas emissions today. As we race toward smarter algorithms, we are simultaneously locking in decades of heavy fossil fuel dependence. The question isn’t whether we can build the infrastructure, but whether society can afford the bill.
