Projections indicate U.S. data centers could consume more natural gas than Germany and Japan combined by 2035.

While private natural gas plants constructed alongside data centers by major technology firms dominate headlines, they will account for only a modest share of future demand. According to a new BloombergNEF outlook, the majority of additional natural gas consumed for AI computing through 2035 will pass through conventional power plants connected to the electrical grid. By 2035, U.S. data centers could consume approximately 18 billion cubic feet of natural gas daily, surpassing the combined consumption of Germany and Japan. Facilities connected to the grid alone will drive about 15 billion cubic feet per day of new power-sector demand—more than double the 6.9 billion cubic feet projected in December. This surge risks pushing natural gas prices higher and adding roughly one million metric tons of greenhouse gas emissions daily.

Companies including Meta, Microsoft, Google, and Amazon have announced plans for dedicated natural gas facilities that bypass the grid to power data centers directly. By 2035, these projects are expected to burn between 2.9 and 3.4 billion cubic feet per day, roughly matching current total data center consumption, including the gas used to generate their grid electricity. Grid-connected facilities, however, carry significantly more weight in the forecast. By the mid-2030s, they are projected to add 15 billion cubic feet per day to power-sector gas demand, representing five times the growth expected from all other grid-connected sectors combined. BloombergNEF anticipates that gas will supply 69% of the electricity for new grid-connected facilities, a trend supported by cheap domestic supply and the ability of gas plants to ramp output quickly. This pattern is already reflected in forecasts of record U.S. electricity demand.

Over the next decade, data centers will rank as the second-largest driver of U.S. natural gas demand growth, trailing only liquefied natural gas (LNG) exports. BloombergNEF estimates LNG exports will add 21 billion cubic feet per day, while power-sector consumption is projected to rise to approximately 54 billion cubic feet per day by 2035—an increase of 18 billion from 2025 levels. The data center estimate has risen sharply since the group’s December projection, which placed grid-connected facility demand at 6.9 billion cubic feet per day. Even though the updated forecast assumes not every announced project will be completed, the figure has more than doubled. “Our power demand estimates are definitely not low, but they’re not the highest on the Street,” said Henry Eaton, lead author of the report and a gas market analyst at BloombergNEF.

Much of the current data center expansion assumes natural gas prices will remain stable, mirroring recent years. Some analysts caution that this assumption may prove unrealistic. Combined demand from data centers and growing LNG exports could drive prices sharply upward. While large technology companies may absorb higher costs through their balance sheets, utility ratepayers likely will not. Supply constraints also present a challenge. U.S. producers are projected to increase output by 35 billion cubic feet per day between 2025 and 2035, yet BloombergNEF estimates an additional 11 billion cubic feet per day will be required to meet total demand. Equipment manufacturers are already capitalizing on the rush to power and cool AI facilities, while some technology firms are diversifying their energy strategies through nuclear development partnerships.

The climate impact is substantial. According to the International Energy Agency, burning one cubic foot of natural gas releases the equivalent of 60 grams of carbon dioxide when accounting for extraction, processing, and distribution. At projected demand levels, data center gas consumption would add approximately one million metric tons of greenhouse gas pollution to the atmosphere each day.

The scale of this demand rivals entire nations. The 15 billion cubic feet per day of added grid demand alone exceeds the natural gas consumption of nearly every country worldwide. Based on U.S. Energy Information Administration data, only China, Russia, Iran, and the United States itself consume more. This positions AI infrastructure as a significant factor in global gas markets rather than merely a local grid concern, particularly as LNG exports increasingly tie U.S. prices to overseas demand. The emissions footprint is equally notable. One million metric tons daily accumulates to roughly 365 million to 395 million metric tons annually. With the United States’ official greenhouse gas inventory totaling approximately 6.3 billion metric tons in 2022, the additional load from data centers would represent about 6% of the national total. This represents a heavy climate burden for a single industry and will test the net-zero commitments many of these technology companies made prior to the AI boom.

Written by Vytautas Valinskas