The explosion of data centers, especially in the era of artificial intelligence (AI), is creating great pressure on the global energy system.
According to a report by BloombergNEF (a research and data analysis organization specializing in energy, clean technology and energy transition markets), the construction cost of natural gas power plants has increased by 66% in just the past two years, reflecting the sudden increase in electricity demand from technology giants (Big Tech).
Corporations such as Microsoft and Meta are accelerating the construction of gas-fired power plants to ensure stable energy supply for data center systems. This is considered a highly reliable option, especially when the demand for data processing is increasing.
However, the cost for mixed-cycle gas turbine (CCGT) plants has increased sharply, from under 1,500 USD/kW in 2023 to over 2,100 USD/kW in 2025.
Not only that, the completion time of a project is also extended by about 23%, slowing down the progress of meeting electricity demand.
The main reason comes from the rapid growth of data centers. It is forecast that by 2035, electricity demand in this sector may nearly triple, from the current 40 gigawatts to 106 gigawatts.
The size of the data center is also increasing, with an average capacity expected to exceed 100 megawatts in the next decade.
This pressure not only causes technology companies to increase investment in gas power but also spreads to power companies. In that context, the cost of building new power sources is often transferred to consumers, leading to an increasing wave of opposition to the expansion of data centers.
In addition, the race to build gas-fired power plants also causes a shortage of gas turbines, which account for up to 30% of the project cost. The price of turbines is expected to increase by 195% compared to 2019, while production capacity cannot expand rapidly, causing the waiting time to extend to the early 2030s.
However, not all technology giants are betting on natural gas. Google is pursuing a different direction, combining renewable energy with long-term storage systems. A typical example is the iron-air battery technology of the US energy technology company - Form Energy, which is capable of continuously supplying electricity for 100 hours.
Unlike gas power, the cost of solar energy and storage systems is gradually decreasing over time, opening up more sustainable alternative opportunities. This shows that the competition between energy sources lies not only in the ability to meet demand, but also in the long-term cost factor.
In the context of continued electricity demand escalating, the technology industry is facing a balancing problem between development speed and energy costs. Today's choice will determine not only operating efficiency but also long-term impacts on the environment and society.
