A recent BloombergNEF report highlights that by 2035, U.S. data centers could consume more natural gas than Germany and Japan combined. Fueled by the booming demand for artificial intelligence, data centers will become the second-largest driver of natural gas growth after LNG exports, potentially using about 18 billion cubic feet daily—almost double previous forecasts from nine months ago. This projection factors in the reality that not all planned data center projects are likely to reach completion.

Major tech companies like Meta, Microsoft, Google, and Amazon are pioneering data centers powered by onsite natural gas plants, bypassing the traditional grid. These projects alone are expected to consume around 2.9 to 3.4 billion cubic feet of natural gas per day by 2035, matching the current overall natural gas consumption of all U.S. data centers combined. However, the bulk of future natural gas demand will come from grid-connected data centers, which could add another 15 billion cubic feet daily, far outpacing other sectors’ growth.

This surge in natural gas use is creating concerns about rising energy prices, especially as global LNG export demands grow simultaneously. While large tech firms may absorb increased costs, utility customers might face higher rates, causing economic strain beyond the technology industry. The dependence on stable natural gas prices is being questioned, as supply dynamics shift and demand for data processing scales rapidly.

Environmental implications are significant, with the increased natural gas consumption projected to produce an additional one million metric tons of greenhouse gases daily—around 12% of current total U.S. emissions. The carbon footprint includes all stages from extraction to burning, raising alarms about the sustainability of current data center energy strategies amid expanding AI workloads. This report underscores the urgent need for alternative energy solutions in data infrastructure planning.