U.S. data centre expansion threatens to raise power-sector emissions

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U.S. data centre emissions rise

Highlights

Sixty planned U.S. data centres from Amazon, Microsoft, Google, and Meta could account for 7 per cent of U.S. power-sector emissions in 2025, equal to 27 coal plants’ output.
Three-quarters of utilities serving these data centres are planning or building new gas-fired capacity, with a third delaying coal plant retirements, intensifying fossil-fuel dependence.
Amazon's emissions rose 16 per cent, Microsoft's 25 per cent, and Alphabet's 18 per cent from 2024 to 2025, primarily driven by data-centre expansion amid clean-energy deployment bottlenecks.

Planned facilities intensify power demand

As reported by Financial Times, the 60 largest planned U.S. data centres being built by Amazon, Microsoft, Google and Meta could together generate emissions equal to about 7 per cent of U.S. power-sector emissions in 2025, based on the latest snapshot of the country's electricity mix.

That estimate is equivalent to the annual emissions of 27 coal plants or 24 million petrol-powered cars. Jonathan Koomey, an energy researcher focused on efficiency and climate solutions, says the figure is a reasonable ballpark estimate and marks a significant increase from what data-centre operators had said they aimed to achieve five years ago under their emissions-reduction plans.

The expansion is also driving more fossil-fuel generation. Three-quarters of the utilities serving those projects are planning or building new gas-fired capacity, based on utility filings, S&P data and DC Byte, while a third of utilities that still operate coal plants are delaying retirements.

Climate targets face mounting strain

The findings highlight how the artificial intelligence infrastructure boom is threatening to slow or reverse progress in cutting emissions from U.S. electricity generation. Although the grid has added more clean energy since 2023, utilities serving these projects are also increasing fossil-fuel capacity to meet surging demand.

Seventeen per cent of utility operators serving the 60 data centres have explicitly told regulators that new gas plants are being built to supply a specific hyperscale data centre. Taylor McNair, deputy director of GridLab, says utilities tend to fall back on new gas generation when demand spikes, adding that rapid load growth is disrupting momentum in renewable deployment.

Global Energy Monitor says the U.S. nearly tripled its gas-fired capacity in development in 2025, a pipeline that could expand the existing gas fleet by nearly 50 per cent if all projects are completed. More than one-third of that planned capacity is intended to power data centres on-site.

Recent sustainability reports from major technology groups also show emissions moving higher. Amazon says its emissions rose 16 per cent from 2024 to 2025, with data-centre construction and delivery fuel among the drivers, while electricity-purchase emissions increased 34 per cent. Microsoft says its total emissions rose 25 per cent over the same period, primarily because of expanding data-centre infrastructure, and Alphabet says its ambition-based emissions increased 18 per cent as supply-chain activity supported rapid business expansion.

Despite continued corporate climate pledges and large clean-energy investments, some companies acknowledge that data-centre construction is pushing up their carbon footprints. Research from Rhodium Group adds that supply-chain bottlenecks, interconnection queue congestion and permitting challenges could slow clean-energy additions, forcing utilities to run existing gas and coal plants harder before new low-carbon generation comes online.

In our earlier coverage of Nvidia’s potential investment in SB Energy for an OpenAI-linked Ohio data center campus, we outlined talks that could combine equity funding, credit support and SB Energy’s planned IPO as AI infrastructure demand accelerates. The report highlighted how chipmakers, developers and AI firms are increasingly coordinating financing and large-scale power-and-computing buildouts to meet surging workloads.

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