Data centers consume vast amounts of electricity to run servers and train and serve AI models. In the United States—the country with the most data centers—this rising demand is straining transmission grids, raising electricity costs and prompting some grid operators to keep fossil-fuel plants online rather than retire them.
PJM Interconnection, which serves 13 eastern states including Virginia (a major data center hub), postponed or canceled the planned closure of about 60% of its fossil-fuel plants last year. Many were “peakers” that are used during spikes in demand. “We need every single megawatt of energy we can get right now,” a PJM spokesman said.
Utilities and developers have responded by investing in gas and nuclear capacity to ensure reliable power. Dominion Energy, which had pledged to reach 100% renewables by 2045, plans major gas and nuclear investments through 2039. NV Energy in Nevada has warned that data-center growth could jeopardize the state’s 2030 clean-energy target. NextEra Energy has said it no longer sees a realistic path to actual zero-carbon emissions by 2045.
Analysts say data centers’ unique and rapidly changing electricity needs push operators toward natural gas because it’s quick to deploy, relatively cheap and reliable. Some AI data centers now use as much electricity as 100,000 households; the biggest facilities being built could need 20 times that. The International Energy Agency (IEA) estimates natural gas supplies more than 40% of data center electricity in the US, with coal providing about 15%. Globally, the IEA projects that natural gas and coal will supply over 40% of the additional electricity required by data centers through at least 2030, making these fuels a significant near-term driver of generation growth.
Low US natural-gas prices and trade tariffs that have raised costs for imported solar panels are further slowing renewable build-out in some places. Political shifts away from aggressive climate policies have also loosened pressure on companies and utilities to prioritize clean power for data centers. Officials have framed decisions about energy sources for data-center expansion as trade-offs between industrial competitiveness and climate goals.
Despite these headwinds, renewables already supply a meaningful share of data-center electricity. In the US, nearly a quarter of the country’s roughly 4,200 data centers get at least some power from renewables, particularly in sunnier southern and southwestern regions. The IEA expects renewables and natural gas together to account for more than 65% of electricity used by data centers by 2030. In parts of Asia, where data-center electricity demand is forecast to more than double by 2030, countries are deploying mixes of renewables, gas and, in some cases, nuclear power.
Clean-energy advocates argue that investments in transmission lines, grid upgrades and battery storage can meet peak demand without relying on polluting peaker plants. On-site renewables and storage, improved energy efficiency in data-center design, and better grid planning and coordination between utilities and data-center developers can reduce dependence on fossil fuels.
Public opposition is growing in some communities where data centers have pushed up local electricity prices or raised environmental concerns. A recent poll found about 65% of Americans oppose having a data center near their home, with many citing electricity costs. Local fights have led to canceled projects and legislative actions: residents in one New Jersey town stopped a planned data center after bills rose nearly 17% last year, and Maine lawmakers have backed a bill pausing new data-center construction until 2027 to assess grid and environmental impacts.
Can data centers be green? Technically, yes—through a mix of renewable generation, storage, grid upgrades, efficiency improvements and careful siting. But doing so at the scale and pace of current data-center growth will require coordinated policy, investment in transmission and storage, stronger corporate commitments, and thoughtful planning to avoid shifting costs or pollution onto host communities.