The rapid expansion of artificial intelligence (AI) data centers is fueling a surge in U.S. electricity demand, positioning natural gas as a main baseload power source. In a new insight, Director of Energy and Environmental Policy Shuting Pomerleau evaluates the evolving role of natural gas in the U.S. energy mix and the critical role of pipeline infrastructure in regional accessibility.

Key points:

• Under a high-demand scenario, natural gas-fired generation is projected to grow by 7.3 percent between 2025 and 2027 to accommodate the AI boom.
• Despite being a top global natural gas producer, the United States sees varied regional pricing due to several factors, including pipeline constraints; specifically, high production levels and a lack of pipeline capacity have recently driven prices at the Waha Hub in Texas below -$2 per million British thermal units, while infrastructure-scarce regions such as New England continue to face higher costs.
• Streamlining the Federal Energy Regulatory Commission’s permitting process and passing permitting reform in Congress are essential for all regions in the United States to benefit from record natural gas production.

Read the analysis.