The explosion in US data center construction has a dirty little secret, and it’s about to show up on your electricity bill. A report from the Union of Concerned Scientists titled “Data Center Power Play” finds that meeting surging data center demand primarily with new natural gas generation creates substantial financial risks for everyday utility customers, to the tune of $886 to $978 billion in cumulative wholesale electricity costs from 2026 to 2050.
The numbers behind the power grab
US data centers consumed approximately 176 TWh of electricity in 2023. That’s about 4.4% of national electricity consumption. Projections estimate data center electricity consumption will reach 325 to 580 TWh by 2028, representing 6.7% to 12% of total US electricity demand.
Natural gas currently provides more than 40% of the electricity powering US data centers, making it the single largest source. Utilities are leaning into gas-fired generation because permitting and construction timelines are shorter than for renewables.
The UCS modeling paints a concerning picture under its mid-growth scenario. As load growth accelerates faster than anticipated, driven by evolving AI workloads and cloud computing expansion, ratepayers face exposure to stranded-asset risks. That’s the scenario where utilities build expensive gas infrastructure that becomes uneconomical before it’s paid off, and customers get stuck holding the bag.
