U.S. Natural Gas Power Buildout Faces Execution Hurdles Amid Rising Demand — CoBank, ACB

Event summary

Gas-fired generation capacity in development has more than tripled over the past two years, driven by data centers, AI infrastructure, and industrial activity.
CoBank's report highlights tighter physical constraints and delivery limits pushing large load customers closer to power and fuel infrastructure.
S&P Global projects U.S. data center demand will rise from 76 gigawatts in 2026 to 134 gigawatts by 2030, outpacing new gas capacity additions.
Equipment bottlenecks, congested interconnection queues, and a diverse sponsor mix will limit new gas-fired capacity additions over the next decade.

The big picture

The U.S. energy sector is investing heavily in natural gas to meet soaring demand for reliable power, marking a shift toward firm, scalable generation. However, this development cycle differs from previous eras due to tighter constraints and higher costs, which could keep electricity prices elevated for consumers over the next decade. The widening gap between large-load demand and firm supply additions poses broader market challenges, including scarcity pricing and elevated consumer bills.

What we're watching

Execution Risk: How equipment bottlenecks and interconnection delays will affect the timeline of new gas-fired capacity additions.
Market Dynamics: Whether scarcity pricing and higher marginal costs for new supply will persist due to tighter reserve margins.
Strategic Shifts: The pace at which private developers backed by hyperscalers and industrial firms influence the location and sourcing of new gas plants.