Natural Gas is America’s Secret Weapon in the AI Power Race
Top natural gas producers and pipeline operators expect the industry and various U.S. states to accelerate approval and development of natural gas infrastructure in the new normal American electricity market of rising demand and consumer bills.
American ratepayers have seen electricity prices rising at a faster pace than U.S. inflation over the past three years. These increases are set to outpace the rate of inflation through 2026, the Energy Information Administration says.
At the same time, the United States has never produced more energy than now, with a record amount in 2024 and rising output of oil and natural gas in 2025, too.
The abundance of energy could help lower electric utility bills for consumers—if there is enough gas linked to powering data centers and manufacturing, the primary growth drivers of U.S. power demand.
Eventually, the spiking energy costs will lead to the various U.S. states approving additional gas infrastructure, EQT Corp, one of America’s top natural gas producers, reckons.
“We’ve never produced more energy than we’re producing now, but Americans’ energy bills are up over 35%,” EQT’s chief executive Toby Rice said during BloombergNEF’s ‘Barrel of Tomorrow in the Age of AI’ summit in Houston this week.
“That’s the catalyst that’s going to get people asking questions,” the executive added.
His opinion that additional infrastructure, most of all gas, will help bring down elevated consumer energy bills was shared by Cynthia Hansen, Executive Vice President & President, Gas Transmission & Midstream at pipeline giant Enbridge, and Chris James, founder and chief investment officer at Engine No.1, an investment firm.
Texas, Pennsylvania, Ohio, and Louisiana – key gas-producing states thanks to the shale regions the Permian, Appalachia, and Haynesville – could be frontrunners in the race to add more gas infrastructure, Enbridge’s Hansen said. Big Tech is scouting for sites in these states amid rising interest to build data centers there to take advantage of the nearby gas supply and friendlier regulatory environment, Hansen said at the BNEF summit.
So far this decade, gas infrastructure development has been shunned due to opposition by U.S. states to host more pipelines and the Biden Administration’s pivot to supporting renewable energy and telling oil and gas companies they are things of the past.
But with the Trump Administration strongly backing American energy dominance, increased oil and gas production, and eased regulatory burdens for project approvals, new infrastructure – pipeline and power plants – could come online to help meet rising electricity demand.
Analysts are also betting on natural gas to help feed America’s AI boom.
Onshoring of manufacturing activity and AI-related data centers are driving an increase in U.S. electricity consumption, Goldman Sachs said in a report earlier this year.
U.S. electrical power demand is expected to rise by 2.4% each year through 2030, with AI-related demand accounting for about two-thirds of the incremental power demand in the country, the investment bank said.
More than $700 billion of grid investment is expected in the country through 2030, as the U.S. infrastructure needs to be updated to accommodate the unprecedented growth of electricity demand, according to Goldman Sachs.
Natural gas is best positioned to capture most of the growth, according to the investment bank.
“Natural gas will benefit significantly from the rising electricity demand and the requirement for 24/7 uninterrupted supply. It is most flexible among all energy sources and an abundant domestic resource,” Goldman Sachs said.
The world’s biggest economy will need all energy sources to ensure power demand is met. Natural gas is the biggest near-term winner of AI advancements, but renewables will also play a key role in powering the data centers of next-generation computing, analysts say.
