Who doesn’t love a good round of FOMO? From dot-com to Web 2.0, virtual reality to blockchain, the tech industry is very afraid of missing a trend.
The AI bubble is the big daddy of them all. Its first offspring – the rush to lock in power to data centers – is now spawning a mad scramble to secure natural gas supplies and equipment. If FOMOs could make babies, then the AI bubble already has grandchildren.
Microsoft said Tuesday it is working with Chevron and the No. 1 engine to construction of a natural gas power plant in West Texas that could be scaled up to produce 5 gigawatts of electricity. This week Google confirmed that it is partnering with Crusoe to build a 933 MW natural gas-fired power plant in North Texas. And last week, Meta announced that it is adding seven more natural gas power plants to its Hyperion data center in Louisiana, bringing the site to 7.46 GW of capacity — enough to power the entire state of South Dakota.
Are we missing anyone?
Recent investment is concentrated in the southern US, home to some of the world’s largest natural gas deposits. Recently, the US Geological Survey estimated that there is enough in one area to power the entire United States 10 months by itself. Every data center operator seems to want a piece of it.
The race for natural gas has led to a shortage of turbines for power plants, with prices likely to rise 195% by the end of this year compared to 2019 prices. according to to Wood Mackenzie. Equipment contributes 20% to 30% to the cost of a power plant. The companies will not be able to place new orders until 2028 and it takes six years for the turbines to be delivered, the consultancy notes.
That means tech companies are betting that AI fever won’t break, that AI will continue to be needed exponential amounts of powerand that natural gas production will be essential to success in the age of artificial intelligence.
Techcrunch event
San Francisco, California
|
13-15 October 2026
They may regret this third case.
Although natural gas supplies in the US are plentiful, and because transporting the fuel is not cheap, the country remains somewhat insulated from the turmoil in the Middle East. But supplies are not limitless, and recently, production growth in the three major regions—responsible for three-quarters of all U.S. shale gas production—has slowed down significantly.
It’s unclear how insulated the tech companies are from price swings, as none of them have disclosed specific terms of their deals. Much will depend on how stable the price is in these contracts.
Even if contract prices are as stable as they can be, companies could face repercussions.
Because natural gas generates about 40% of US electricity, according to According to the Energy Information Administration, electricity prices are closely tied to natural gas prices. Tech companies may be able to shield themselves from scrutiny for a while by moving gas-fired power plants behind the meter — bypassing the grid and connecting them directly to their data centers. However, natural gas is not a limitless resource, and if their ambitions get too high, even behind-the-meter work could raise electricity prices for everyone. We’ve all seen how it plays out.
It won’t just be ordinary households that get upset. Other industries, including those that are still much more dependent on natural gas and cannot yet switch to renewables, may shy away from data centers that will grab so much of the resources. Powering a data center with wind, solar and batteries is easy. Operation of a petrochemical plant? Not so much.
Then there’s the weather. A cold winter could change the calculus by increasing demand among households. Wells can freeze over, crushing supplies dramatically, as happened in Texas in 2021. When gas runs out, suppliers will face a choice: keep AI data centers running or let people heat their homes?
By decoupling natural gas supplies and moving behind the meter, tech companies can claim they are “bringing their own power” and not straining the power grid. But in reality, they are just shifting their usage from one network to another, the natural gas network. Artificial intelligence has shown how physically limited the digital world remains. Does it make sense to bet big on a finite resource? Tech companies may regret falling for FOMO.
