Data Centres: Grid For Starters, Gas For Mains

The electricity grid was just the appetizer. In July 2026, BloombergNEF projected that US data centre capacity will reach 194GW by 2035. Power availability and resilience are now the primary constraints for site selection and sector growth. BNEF puts the US grid's annual data centre connection limit at around 10GW, leaving roughly 48GW of projected capacity to be supplied with on-site gas generation. This significant undertaking is equivalent to building more than 10 Plant Vogtles – America’s largest nuclear power plant, according to the Energy Information Administration (EIA).

Next is the main course: natural gas. Energy equipment manufacturer GE Vernova has orders and reservations for 116GW worth of gas turbines globally as of Q2 2026, with a current manufacturing capacity of 20GW a year. At that capacity, existing orders alone would average a lead time of 5.8 years, though the firm intends to scale up production.

Power meets permitting

‘Power foundries’ – gas plants supplying data centres directly – are now paramount in most primary data centre markets. In hubs with the skilled labour, fibre infrastructure, water supply and other essentials required for the development of hyperscale facilities, they are increasingly being used to underpin the economics and timelines of land permitting. Power foundries are typically developed jointly with an energy partner or built outright by the operator. With grid instability and electricity prices rising, removing grid connections from the permitting equation expands the pool of available sites that can clear other fatal flaw criteria such as favourable power economics, flood risk and flat ground.

This set-up can sidestep grid-cost amplification and in some cases improve community sentiment and fast-track permitting. However, high levels of noise pollution from power foundries can also have a significant negative impact on communities. These kinds of trade-offs emphasize the importance of community engagement at all stages of data centre development, and the increasing need for lifecycle analysis (LCA) tracking.

Insatiable appetite

The data centre energy squeeze is cascading from traditional large frame turbines into other types of gas generation to align lead time with data centre permitting and build times, which are around four to five years in primary markets. One solution is reciprocating engines. For example, Caterpillar is supplying 2GW of its G3516 engines to the Monarch Compute Campus in West Virginia. The deal was announced in February 2026, and deliveries will run from September 2026 to August 2027, with full capacity online in approximately 18 months.

With new turbine builds taking years, jet engines repurposed as aeroderivative turbines are another option. Aftermarket turbine provider FTAI Aviation refurbishes CFM56 engines for data centres, and in July 2026 announced a $1.5 billion order from a cloud provider, targeting batched deliveries through November 2027.

Many hyperscale campuses are built in phases of 1GW to 1.4GW, positioning fuel cells powered by natural gas as a highly modular and scalable energy solution. Manufacturer Bloom Energy expanded its partnership with Oracle in April 2026 from an initial 1.2GW to a potential 2.8GW. Due to their modular nature, delivery timelines depend on desired fuel cell capacity – with Bloom supplying one system to Oracle within 55 days.

These gas assets are the primary solution for satisfying the estimated 48GW data centre supply shortfall in the US. Continuous gas combustion of this magnitude would emit somewhere in the staggering range of 150 million to 225 million tonnes of CO₂ a year (depending on whether waste heat is recycled), using the IPCC’s default emissions factor for natural gas combustion.

Gas turbines, engines and fuel cells are all being deployed to optimize two factors: speed to power and favourable energy economics. Despite the substantial increase in emissions the US faces, carbon isn’t even in the conversation. When it comes to using intermittent renewables for primary power, no hyperscale developer wants to be the multi-billion-dollar guinea pig who can’t keep the lights on.

But if natural gas is the main course, what’s for dessert? Orders are already being placed.

For more on data centre developments, check out the Verdantix Insights page.