Data centres pull coal and gas back into the power mix as clean supply runs short
BloombergNEF now expects fossil fuels to supply 51% of incremental data-centre generation by 2050, even as solar becomes the world's largest power source.
Data centres will draw 51% of their incremental electricity from coal and gas through 2050, BloombergNEF forecasts, undercutting the assumption that the AI build-out would run overwhelmingly on new renewables2. The same research house expects solar to overtake coal, oil and gas as the largest source of power within the next decade2.
That split matters because the two trends are not in conflict. Solar is winning on total installed capacity; gas and coal are winning where the load is dense, continuous and sited faster than transmission can reach it. BloombergNEF attributes the fossil share to the ability of those plants to run around the clock2.
The evidence from the companies driving the demand is already visible in their own emissions ledgers. Google's emissions have jumped nearly 50%, Amazon's have risen 33%, Microsoft's more than 23% and Meta's more than 60%1. Those increases follow years in which each company publicly committed to running on clean power.
Google, which six years ago was confident of powering all operations from clean sources by 2030, now describes that goal internally as a moonshot1. Microsoft says it is still aiming to remove more carbon than it emits1. The shift in language is being matched by the shift in procurement: companies racing to build data centres that can consume more power than entire cities say they need flexibility, and are acknowledging they are not on track even where targets have not formally been revised1.
The scale of the problem is a function of how quickly the load is arriving. Data centres used about 4.6% of total US electricity in 2024, a share government estimates say could nearly triple by 20281. Some analysts expect nationwide electricity use to climb as much as 20% over the next decade, with data centres a leading contributor1.
The existing fuel mix for that load is already fossil-heavy. Natural gas supplied more than 40% of the electricity powering US data centres in 2024, and coal supplied 30% globally, according to the International Energy Agency1. Off-grid gas has been pitched as a way to bypass slow interconnection queues, but Canary Media reported in July (2026-07-24) that it will not close the gap on its own4.
The pressure is not confined to the United States. Data centres, electric vehicles and green industrial clusters are expected to add roughly 100 TWh of incremental power demand in Southeast Asia by the end of the decade, according to research from Bain & Company and Standard Chartered, and the region may struggle to accommodate it5.
Batteries are part of the answer, though at a scale that remains experimental for this application. Google has included $1bn of 100-hour batteries from Form Energy in a recent data-centre project2. Longer-duration storage at that duration is intended to displace gas peakers rather than baseload, and no comparable volumes are yet contracted across the sector.
Solar economics continue to improve independently of the data-centre story. BloombergNEF expects solar prices to fall another 30% by 2035, at which point the technology outcompetes coal and natural gas2. BloombergNEF also flags a dash to gas across Argentina, Brazil, Canada, Guyana, Israel and Mozambique as countries expand production3.
For now, the marginal megawatt feeding a new campus in a constrained market is more likely to be gas than solar, because a gas plant can be permitted and built on a site next to the load while a transmission upgrade cannot. The coal share, particularly in Asia, reflects a similar logic of speed over emissions.
The forward signal to watch is the pace at which grid connection requests convert into signed generation. If a meaningful share of the roughly 100 TWh of Southeast Asian demand identified by Bain and Standard Chartered is met from LNG, Asian spot cargo demand tightens against an already elevated JKM benchmark. If it is met from domestic coal, Newcastle physical coal holds its premium. Either path runs through the same constraint: power that can be delivered on a deadline, not the cheapest power in a model.
The emissions targets Google, Amazon, Microsoft and Meta set will be quietly re-based against that reality over the next two reporting cycles. Watch the next round of sustainability disclosures for whether the moonshot language spreads beyond Google.1