Global data center electricity demand is projected to reach 2,354 TWh annually by 2035, raising concerns over natural gas dependence, carbon emissions and grid constraints, according to BloombergNEF.
-By Laura Contemori
Data center electricity demand could reach 7% of global consumption by 2035
Global data center electricity demand is expected to nearly quadruple by 2035, reaching 2,354 TWh per year, equivalent to 7% of worldwide electricity consumption. The surge, driven primarily by the expansion of digital infrastructure and artificial intelligence, could increase emissions and prolong reliance on fossil fuels.
These findings come from the report Powering the Data Center Boom: How Grid Policy Can Deliver Clean Power Faster, prepared by BloombergNEF (BNEF) and commissioned by Bloomberg Philanthropies.
The main challenge lies in grid connection delays. In the United States and Europe, electricity network constraints are slowing the connection of new data centers. To bring facilities online sooner, some developers, particularly in the US, are planning to build on-site gas-fired power plants, according to the report.
Renewable energy has so far played a limited role in meeting this demand, largely because of its greater land requirements and lower ability to provide dispatchable electricity compared with natural gas.
Data centers and natural gas: 181 GW of planned capacity
BloombergNEF has identified 181 GW of announced new gas-fired generation capacity associated with data centers, with more than 90% located in the United States.
These projects have different development timelines. The figure therefore represents the potential scale of the trend rather than a forecast of how much capacity will ultimately be built.
According to BNEF, the risk extends beyond short-term emissions. Many developers regard gas-fired power plants as a temporary solution while awaiting grid connections.
However, once these facilities are built, the capital already invested could make continued operation economically attractive even after grid access becomes available, extending dependence on fossil fuels.
If all announced US data center gas projects were completed and operated under BNEF’s assumptions, they would generate approximately 345 million tonnes of CO₂ equivalent annually.
That would represent 152 million tonnes more than a scenario in which the same data center capacity was supplied with grid electricity, an increase equivalent to 10% of US power sector emissions in 2025.
In developed markets, accelerating grid connections offers a more sustainable alternative to constructing dedicated gas-fired generation facilities.
However, grid access alone is not enough. Unless rising electricity demand is matched by greater availability of clean energy, connecting new data centers could still increase fossil fuel-based electricity generation.
“The climate impacts will depend not only on how much electricity these facilities consume, but also on how quickly grids can connect them and the ability of power systems to integrate cleaner generation sources to meet that demand,” warned Mark Daly, Head of Data Centers and Emerging Tech at BloombergNEF.
Data center electricity demand in emerging markets
The outlook differs in countries where electricity systems remain heavily dependent on coal. BNEF examines four emerging markets: Brazil, India, Indonesia and Malaysia.
Under BNEF’s scenario, almost all additional electricity generation required to meet data center demand in Brazil through 2035 is expected to come from renewable sources.
In India, by contrast, a substantial share of additional demand will be met through increased utilisation of existing coal-fired power plants.
Data center electricity demand in India is projected to rise from 11 TWh in 2025 to 91 TWh in 2035.
In Indonesia, existing regulations prevent data centers from entering into direct electricity supply agreements with independent renewable energy producers.
In Malaysia, BNEF expects data center electricity demand to increase from 7 TWh in 2025 to 45 TWh by 2035.
Continued demand growth is expected to drive the construction of additional gas-fired generation capacity over the longer term while extending the operational lifespan of existing coal-fired power plants.
