Data Centers are Slowing America's Shift Away From Coal

As tech companies have built hundreds of hyperscale data centers to power the artificial intelligence boom, they have triggered conflicting predictions over how these facilities will affect the nation’s power grid. Critics have argued that data centers will raise power bills and increase carbon emissions. Supporters claimed they could increase investment in infrastructure and clean energy, leading to lower prices and emissions.

We now have a clearer picture about at least one consequence of the data center boom, and it isn’t encouraging. A report released last week from the Energy Information Administration found that carbon emissions from the U.S. power sector rose by 4 percent last year — larger than the increase in the economy overall, where emissions only ticked up 2 percent.  The agency attributes this rise to a 13 percent increase in coal power generation, partially driven by the proliferation of large-scale data centers.

The national increase in power sector emissions represents the reversal of a longstanding trend. Before the AI boom, U.S. power consumption had been flat for decades. Utilities, grid operators, and energy planners had assumed that pattern would continue, and many planned to retire their older and dirtier coal plants with the expectation that natural gas and renewables could replace them. Instead, electricity demand is rising much faster than anticipated. Data centers could make up more than 10 percent of U.S. electricity usage by 2030, and they operate around the clock, including when wind and solar farm output is low. That demand has extended the life of some aging coal plants.

“Commercial load is starting to grow, and that’s part of the data center story,” said Steve Piper, the director of energy research at S&P Global Energy, a market intelligence firm. “It’s kind of a rising tide lifts all boats phenomenon. While we think structurally coal will decline over time, [the AI boom] is going to slow down that decline.”

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 Why West Virginia Coal is Essential for America's Energy Future

Across America, the energy landscape is undergoing a transformation of unprecedented scale. As our nation accelerates its shift toward a digital-first economy, the demand for electricity is rising at a pace that few predicted even a decade ago.

From the massive power requirements of artificial intelligence and high-density data centers to the increasing electrification of our manufacturing sector, the modern grid is facing an urgent stress test.

In this climate, we must have an honest conversation about the resources that can truly provide dependable power at scale.

For too long, the national conversation has been dominated by debates that overlook the physical reality of our power grid. The energy demand is not just a policy preference; it is an industrial necessity.

To keep our economy growing, we need more than just intermittent sources of power — we need reliable, dispatchable, and resilient base load generation. We need coal.

For West Virginia, this is not a new concept; it is our legacy and our future.

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The Natural Gas Price Squeeze is Coming, Coal Offers a Critical Safety Valve

The decade of cheap domestic natural gas is coming to an abrupt end. So say analyses from Wood Mackenzie and Bloomberg New Energy Finance (BNEF), a conclusion that holds huge implications for our energy policy, consumers and the nation’s economic competitiveness.

Wood Mackenzie forecasts Henry Hub natural gas prices, the domestic benchmark, will approach $5 per million BTUs by 2035, up from the range of $2 to $4 that characterized prices for the past decade. These extraordinarily low prices propelled natural gas to become the nation’s leading fuel for electricity generation, incentivized a rush for gas to power the AI and datacenter revolution, and turned the U.S. into the world’s largest LNG exporter. But these same low prices have now created sustained structural demand as supply becomes both more challenging and more expensive to grow.

“Rapid play development, near-zero-cost associated gas, and year-on-year productivity gains drove that era of cheap, stable prices. Those tail winds have largely run their course,” the report’s authors observed. “Prices will need to rise to grow supply from here.”

And as supply stalls, new demand is arriving at a stunning level. Wood Mackenzie sees 17 billion cubic feet per day of new natural gas demand coming from the power sector alone by the mid-2030s, roughly half the gas demand of the entire existing power sector. If not enough, U.S. LNG capacity is on track to more than double from current levels. The U.S. will account for more than one-third of global LNG supply by the early 2030s.

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