The AI buildout could make U.S. data centers a major force in natural gas markets, not just electricity markets. A new BloombergNEF report projects that by 2035 U.S. data centers will consume about 18 billion cubic feet of natural gas per day, roughly double the organization’s forecast from nine months ago. That level would put data center gas consumption above the combined consumption of Germany and Japan today. Over the next decade, data centers are expected to be the second-strongest driver of natural gas demand growth in the U.S., behind only LNG exports. The revised forecast accounts for the reality that not every announced data center project will actually be completed.

The headline-grabbing trend is onsite power generation. Meta, Microsoft, Google, and Amazon have all announced plans for natural gas power plants that bypass the grid and power data centers directly. BloombergNEF estimates these onsite projects will consume 2.9 billion to 3.4 billion cubic feet per day by 2035. That is roughly equal to what all U.S. data centers consume today, including natural gas used to generate electricity on the grid. Yet onsite power is only part of the story. BloombergNEF predicts grid-connected data centers will drive an additional 15 billion cubic feet per day of natural gas consumption by the power sector by the middle of the next decade—five times more demand growth through 2035 than from all other grid-connected sectors combined.

If that demand materializes, natural gas prices could rise. The current data center boom has relied on relatively stable gas prices, but analysts at Noreva argue that stability may be a false hope. The combined pressure from data center demand and rising LNG exports could push prices sharply higher. Tech companies may be able to absorb that cost, but utility ratepayers likely cannot.

There is also a significant climate cost. Citing the IEA, the article notes that burning one cubic foot of natural gas releases the equivalent of 60 grams of carbon dioxide, including emissions from extraction, processing, and distribution. The additional data center demand would generate about 1 million metric tons more greenhouse gas pollution every day, roughly 12% of total U.S. greenhouse gas emissions today.