No longer the realm of science fiction, artificial intelligence (AI) is transforming industries, advancing innovation, and redefining our everyday experiences. But while we’re dazzled by its seamless operation, most of us overlook what’s behind AI that makes it all possible. That unsung hero is energy – and lots of it. As data centers and power plants are grappling with rising electricity demand fueled by AI technologies, natural gas is emerging as the primary energy source of this digital revolution.
Energy Transfer is already taking full advantage of this rise in natural gas demand, with several projects either underway or under discussion to supply, store, and transport natural gas for power plants, data centers, and industrial and onshore manufacturing.
“We have received requests for potential connections to approximately 62 power plants that we do not currently serve in 13 states and up to 15 plants that we already serve today,” said Tom Long, co-CEO, Energy Transfer. “In addition, we have received requests from over 70 prospective data centers in 12 states. Given Energy Transfer’s extensive natural gas infrastructure, we continue to believe that we are the best positioned to capitalize on the anticipated rise in natural gas demand.”
In January, we announced our first commercial arrangement to supply natural gas directly to a data center site, a long-term agreement with CloudBurst Data Centers to provide natural gas to its flagship, AI-focused data center development in Central Texas. The natural gas supply is expected to generate approximately 1.2 gigawatts of direct power to the AI-focused data center.
Energy Transfer’s Hugh Brinson Pipeline is also expected to be the premier option to support power plant and data center growth in Texas. The pipeline will deliver natural gas from the Permian Basin to major markets and trading hubs throughout Texas.
Why Natural Gas?
Natural gas has several characteristics that make it ideal for fueling AI’s energy needs.
- Efficiency and Reliability: Natural gas power plants are highly efficient at generating electricity. They can quickly ramp up production to meet the energy spikes often seen in AI applications, ensuring uninterrupted operations.
- Lower Carbon Footprint: Compared to coal, natural gas burns cleaner, resulting in fewer emissions of nearly all types of air pollutants and significantly less carbon dioxide.
- Abundance and Affordability: With abundant reserves globally and advanced extraction technologies, natural gas remains a cost-effective energy source. Its affordability makes it accessible for large-scale power requirements, like those of AI data centers.
While renewables like wind and solar have their place in our nation’s energy mix, they are unable to produce the 24/7/365 power generation required by AI data centers. That’s why natural gas is so well suited to meet this growing energy demand: it’s reliable. This is especially important for the round-the-clock operations of data centers and other critical infrastructure supporting AI. It’s also one of the main reasons why natural gas has become the largest source of U.S. electricity generation, making up about 43 percent of the electricity generated in our country.
As the world increasingly relies on AI, the pivotal role of natural gas in powering this revolution cannot be overstated.
With our extensive infrastructure, innovative projects, and forward-thinking strategies, Energy Transfer is at the forefront of meeting this growing demand. The future of power generation is here, and Energy Transfer is leading the way.
