Commentary: Big Tent Ideas

Amazon Knows What Really Powers The AI Boom — And It Isn’t Wind And Solar

Amazon founder Jeff Bezos (Photo via Flickr)

For years, Amazon has been one of corporate America’s key poster children for climate virtue signaling. No company in the country has contracted for more “carbon free” power gen — 25.6 gigawatts of it, including 17.9 GW of solar and 4.4 GW of wind according to a new report from the research firm Cleanview.

But when it comes to keeping its servers running around the clock, Amazon is doing what most serious players in the data center business are doing — turning to natural gas.

Cleanview finds that utilities and independent power producers are currently building 8 power plants totaling 17.5 GW of new gas-fired generation to serve Amazon. That equates to about 1.5 times New York City’s peak demand. It is also, in Cleanview’s words, a gas fleet the company “doesn’t talk about much publicly.”

Oh.

The scale of Amazon’s ambitions helps explain the choice of power source. Cleanview counts 44 GW of Amazing data centers under development in 16 states, on top of 13.9 GW already in operation. The company says it expects to spend $220 billion on capital projects this year, 3.5 times what it spent in 2022.

For years, Amazon plugged into utilities with spare capacity in Virginia, Ohio and Oregon, then signed renewable power contracts to “match” its consumption on paper. It was a popular model across the industry in its early days, in fact. Cleanview reports that model broke within a two-year window as the utilities “simply ran out of power.” Amazon, still tied into the data center industry’s 99.999% uptime requirement, had to go elsewhere to acquire the reliable, cheap, 24/7 natural gas power gen it needed.

What is being built now is impressive. In Peco County, Texas, Amazon told Cleanview that it acquired the GW Ranch site, where 35 gas turbines are permitted for up to 7.65 GW capacity — entirely behind the meter, off the Texas grid. In western Pennsylvania, on the site of what was once the state’s biggest coal plant, Amazon plans for a massive campus powered by the 4.5 GW Homer City gas plant, which starts construction in December. In Mississippi, Cleanview found Entergy is investing $3.4 billion in 2.3 GW of new gas capacity serving Amazon alongside a mere 270 MW of solar.

So, whatever state it moves into now, the company that has bought more solar than anyone in America now buys gas when it needs power every hour of every day. Again, this is a commonplace model now across the data center industry. The hyperscalers’ own purchasing decisions have done more to expose the limits of wind/solar-only plans than a decade of filings by grid operators ever did. No wonder Amazon doesn’t like to talk about it much.

Critics in the climate alarm lobby will claim data centers drive up costs for ratepayers. This is nonsense, a point that President Donald Trump drove home when he brought Amazon, Google, Meta, Microsoft and others together to sign the Ratepayer Protection Pledge, committing them to “build, bring, or buy” their own generation and pay for upgrades their data centers require. Early results are encouraging beyond Amazon’s own pledge that its GW Ranch project “won’t raise electricity costs for Texas families.” Indiana Michigan Power has proposed a rate cut worth about $100 annually for a typical household, made possible by revenue from big customers like data centers. Entergy says data center revenue prevented a $4.87 monthly increase for its Mississippi customers.

Infrastructure supply chains are now the holdup to getting it all done. Gas plants need gas and gas needs pipelines. One of Entergy’s new Mississippi plants depends on a $131 million pipeline expansion still awaiting FERC approval. Trump’s 2025 executive order on data center permitting explicitly covers gas pipelines and turbines, but Congress still needs to deliver legislation to ensure the next administration can’t simply strangle these needed projects in the crib.

What is clear is that natural gas is the only resource that can deliver the gigawatts of firm power gen on the timelines the artificial intelligence race demands. Longer term, Amazon is also betting on nuclear — 1,920 MW from Susquehanna, 1,200 MW from Comanche Peak and an X-energy small modular reactor project in Indiana. That’s all great, but new reactors are a 2030s solution in the best scenarios.

Until then, the AI boom will run on American natural gas, because that is what energy reality requires.

David Blackmon is an energy writer and consultant based in Texas. He spent 40 years in the oil and gas business, where he specialized in public policy and communications.

The views and opinions expressed in this commentary are those of the author and do not reflect the official position of the Daily Caller News Foundation.