Data centers require vast amounts of electricity to run servers and power applications, including generative AI models. The United States hosts more data centers than any other country, and that extra demand is straining transmission grids and raising power costs. Grid operators facing rapid load growth have turned to polluting fossil fuels to meet immediate needs, in some cases postponing planned retirements of oil, gas and coal plants or even considering new fossil or nuclear investments.
PJM Interconnection, the largest US power grid covering 13 eastern states (including Virginia, a major data center hub), delayed or canceled planned closures for about 60% of its fossil plants last year. Many of the deferred units were “peakers” — plants that run during periods of high demand. “Electricity demand is outstripping supply — we need every single megawatt of energy we can get right now,” a PJM spokesperson said.
Utilities that had committed to cleaner futures are adjusting plans to preserve reliability. Dominion Energy in Virginia, which had pledged 100% renewable sourcing by 2045, is now planning substantial investment in gas and nuclear capacity through 2039. NV Energy in Nevada warns data center growth could prevent the state from meeting a 50% renewable target by 2030. NextEra Energy in North Carolina said it no longer sees “a realistic path” to zero-carbon emissions by 2045.
Why gas and coal? The electricity profile data centers need — large, rapid and often unpredictable loads — favors dispatchable, on-demand generation. Dave Jones, chief analyst at Ember, notes AI data centers can already consume as much electricity as 100,000 households, and the largest centers under construction might need 20 times that. Because future demand is hard to predict and onsite generation is sometimes used, many operators view natural gas as “the quickest, cheapest, easiest way” to supply reliable power.
International Energy Agency (IEA) figures show natural gas supplies more than 40% of the electricity used by US data centers, while coal supplies about 15%. The IEA projects that coal and gas will account for over 40% of the additional electricity required by data centers through at least 2030, making new data center demand a near-term driver of fossil-fuel generation growth.
Market and policy factors reinforce this reliance. US natural gas prices have been relatively low, making gas competitive. Tariffs on imported solar panels and related equipment have slowed renewable expansion. And political shifts reducing emphasis on climate policies have weakened incentives for rapid clean-energy adoption. Some government officials and agencies have signaled greater support for fossil fuels and nuclear to sustain industrial and AI growth, framing decarbonization as a trade-off for economic objectives.
Clean-energy advocates argue a trade-off is unnecessary if governments and utilities invest in transmission upgrades, battery storage and smarter grid planning. Those measures can help integrate greater renewable supply while maintaining reliability without turning back to polluting peaker plants.
Renewables already supply a substantial share of data center electricity in many places. In the US, nearly a quarter of more than 4,200 data centers draw at least some power from clean sources, particularly in sunny southern and southwestern states. Globally, the IEA says renewables and natural gas are set to account for over 65% of electricity for data centers by 2030, and in regions such as India and China a mix of renewables and coal currently dominates. Rising fossil-fuel prices in some markets have also pushed countries to accelerate clean-energy investment.
Local communities and policymakers are pushing back against rapid data center buildouts that threaten energy affordability and local infrastructure. A Quinnipiac University poll found 65% of Americans opposed having a facility near their home, often citing higher electricity costs. In New Jersey, residents successfully blocked a planned data center over environmental and energy concerns. Maine legislators have supported a moratorium on new data center construction until November 2027 to allow assessment of grid and environmental impacts.
Critics say without coordinated planning, sprawling data center growth can place extraordinary demands on electric infrastructure, the environment and host communities. Advocates for balanced energy policy stress that targeted investments in transmission, storage, and clean generation — plus stricter planning rules for data center siting and power procurement — can accommodate digital and AI expansion while limiting reliance on coal and gas.