PRESS RELEASE

New York, November 11, 2026 – Data center power demand is set to surge as developers seek to bring new computing capacity online quickly. BloombergNEF (BNEF) expects data center electricity demand to almost quadruple to 2,354 terawatt-hours by 2035, equivalent to 7% of global electricity consumption, according to a new report commissioned by Bloomberg Philanthropies.

Powering the Data Center Boom: How Grid Policy Can Deliver Clean Power Faster finds that grid constraints in the US and Europe are delaying new connections for large loads, while the financial rewards for energizing quickly are driving some developers to build on-site gas-fired power as they await a grid connection. BNEF has tracked 181GW of announced gas-fired generation proposed alongside data centers, more than 90% of which is in the US. The announced pipeline varies widely in maturity and timing and should be viewed as an indication of potential scale rather than a forecast of what will ultimately be built.

If all announced on-site gas plants proposed for US data centers were built and operated at the assumptions used by BNEF, they would emit about 345 million metric tons of carbon dioxide equivalent a year. That would be 152MtCO2e more than if the associated data center capacity were supplied by average US grid electricity, an amount equivalent to 10% of US power-sector emissions in 2025. Although many of these projects are intended to supply power while data centers await a grid connection, BNEF finds that once they are online, the economics could encourage them to continue generating energy, creating a longer-term fossil-fuel lock-in risk beyond the annual emissions.

In developed markets such as the US and Europe, ensuring new data centers are grid-connected is the more sustainable option, making faster grid connections important to limiting near-term emissions impacts and fossil-fuel lock-in risk. Continuing to decarbonize the power system in parallel also remains vital.The report reviews policies across 17 markets that aim to accelerate the grid connection process. The policy landscape is still emerging and while many efforts should reduce waiting times for connections, there is currently limited empirical evidence to demonstrate which will be most effective.

Mark Daly, Head of Data Centers and Emerging Tech at BloombergNEF said, “The extraordinary economics around AI are making speed to power one of the most important priorities for  defining constraints on data center developers. The climate outcome will depend not only on how much electricity these facilities use, but on how quickly grids can connect them and whether power systems add cleaner generation alongside that demand.”

In emerging markets, the challenges of mitigating the climate impact of data centers differs. BNEF finds that, where power systems remain heavily reliant on coal, grid-connected data centers can be even worse than those powered by on-site gas. This highlights how much more central it is in these markets to enable more clean generation alongside sources of new power demand.

The four emerging markets examined in the report are:

• Brazil: BNEF expects almost all incremental generation needed to meet data center demand through 2035 to come from renewables. Large consumers buy directly with renewable generators, and new data center demand could absorb some renewable generation that is currently curtailed, although transmission remains a constraint.
• India: Data center electricity demand is expected to rise from 11TWh in 2025 to 91TWh in 2035. Existing coal plants supply much of the additional electricity in the near term under BNEF’s Economic Transition Scenario, but data centers can procure clean power through bilateral and captive projects, and companies are already backing new solar and wind capacity.
• Indonesia: Coal and gas supplied 82% of state utility PLN’s on-grid power in 2025. Current rules do not allow data centers to contract directly with independent renewable generators, limiting their ability to link corporate demand clearly to new clean-power capacity.
• Malaysia: Data center electricity demand is set to rise from 7TWh in 2025 to 45TWh by 2035. Additional demand is expected to increase the use of existing coal and gas plants in the near term, while continued demand growth is likely to result in new gas capacity and coal life extensions over the longer term. Data centers can contract with third-party renewable generators and are already supporting new solar projects, although network charges can affect the economics of these contracts.

The report finds that policies to accelerate grid connections can help limit the near-term emissions impact and fossil-fuel lock-in risk in developed markets, but the challenge differs across markets. Continued power-system decarbonization and frameworks that allow data centers to support additional clean power will also be important as data center electricity demand grows.

BloombergNEF clients can find the full report on bnef.com and at this link. 

Media Contact

Oktavia Catsaros
BloombergNEF
ocatsaros@bloomberg.net

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