AI 2026: Gas Turbine Demand Pushes Data Centers to Become Power Plants
Heavy-duty gas turbines are among the most difficult to manufacture products in the world. Only a handful of mature firms control the supply chains with Chinese competitors lagging years behind.
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Gas turbines are types of internal combustion engines that convert chemical energy from natural gas into mechanical rotation that a generator then converts into electricity. Gas is the world’s second-largest energy source for power generation, behind only coal: in 2025 gas power plants worldwide generated around 7000 terawatt-hours (TWh) of electricity, compared to around 10,500 TWh for coal plants.1 Such power plants are especially important in regions such as the United States where, due to the fracking revolution, natural gas remains cheap and abundant, and also in many European countries where regulatory factors have combined to drive coal and nuclear power plants out of operation. Similar U.S. regulations mean that the recent significant increase for U.S. electricity demand, which was close to stagnant for two decades, and is driven primarily by AI data center construction, will be met through burning natural gas, driving rapidly expanding demand for gas turbines.