Fossil gas, once considered a bridge fuel as coal plants retired and renewables expanded, is dominating development pipelines for the largest AI data centers in the U.S. Over the last year, most major data center developers have placed big bets on gas. Major financial institutions and the Trump administration itself, which plans to lease federal land for the 9.2 gigawatts of gas capacity SoftBank’s SB Energy is planning to build for OpenAI data centers in Ohio, are backing the push.
In the first half of this year, the U.S. nearly doubled the gas-fired capacity it is developing to directly power data centers. That data was released just a week before the latest report from the United Nations found that the world has shot past its goal of limiting warming and now must focus on ways to limit the “overshoot.”
The dash for gas stems from multi-year interconnection queues, transmission backlogs, and the firm power demands of AI workloads, compounded by intermittency and capacity accreditation problems for renewables. Climate and clean energy goals have taken a back seat to speed to power, as tech giants race to secure any available firm electrons, accepting fossil generation as an immediate necessity — though no one seems to know where that ends.
In parallel, though, there’s a growing crop of companies confident that renewables aren’t just workable for data centers, but that they’re faster to build. And they’re already quietly building, and selling, clean projects. Companies like Planted Solar have gigawatt-scale pipelines of projects for data centers, and Nvidia, which is backing SB Energy’s massive Ohio gas project, recently took a minority stake in powered land developer Cloverleaf, whose primary focus is on “clean-powered” projects.
Customers still aren’t asking for clean power, explained Cloverleaf co-founder and chief commercial officer Brian Janous, but they also aren’t the ones with the decades of experience building power plants and data centers: “Efficiency and lower carbon solutions are going to be faster than building massive gas plants, so even if that’s not what they’re asking for, our view is it’s still the right solution for them,” he said.
And, while clean energy may not be top of mind for the big tech companies right now, these are long-term projects, and “at some point they will care again.”
The speed advantage
The problem with the so-called gas “mega projects” that pull headlines is that they usually wind up costing a lot more than planned, and taking a lot longer than planned, Janous said. “On a small scale, can you stand up some [reciprocating gas engines] faster than you can get a grid connection? Sure, in some cases, but I don’t think that’s universally true,” he added.
Cloverleaf is developing massive amounts of powered land for the biggest players in the AI space, but is focused on grid-connected sites that leverage multiple types of generation, Janous explained. In Port Washington, Wisconsin, for example, the company is building out a stack that includes wind, solar, battery storage, and nuclear relicensing, as well as peaking gas for firming, to serve an OpenAI and Oracle site. Cloverleaf is on track to deliver around 7 GW of grid-connected sites like it to customers by the end of this year, all of which Janous expects to be fully online by the end of 2028.
“I would challenge you to find any mega project that is truly going to have 7 GW of stuff that is fully operational in that time horizon,” he added.
But it’s not just for grid-connected projects that the pendulum is starting to swing toward renewables. Behind-the-meter configurations are also experiencing a “gentle turn” back toward cleaner generation, said John Belizaire, CEO of renewables-powered data center developer Soluna. “Folks are thinking about the long-term aspects, like what happens if there’s a regulatory shift,” he explained.
Soluna, whose model centers on co-locating data centers directly with existing solar, battery, and especially wind projects, has a data center pipeline of close to 6.3 GW, largely in Texas. Leveraging existing renewables plants is faster than building new gas or waiting for a grid connection, but to meet the uptime and firming requirements that some data centers require, Soluna is increasingly siting projects near gas tie-ins so it can add on-site generation if needed, Belizaire added.
Soluna’s core focus has been wind power, but a similar shift is also underway in solar, said Lisa Wang, founder and CEO of Daylight Infrastructure, a tech-enabled advisory firm that diligences powered land parcels and connects clean energy developers with data center demand.
Daylight’s software platform, which automates site screening for everything from zoning and permitting risk to local sentiment toward data centers, works with both grid-tied and behind-the-meter projects for edge and hyperscale sites. In less than a year, Wang explained, solar has gone from something many data center developers weren’t even considering, to a central part of their strategy; surprisingly, behind-the-meter solar has seen particular momentum.
Without some type of firming capacity, fully off-grid solar, even paired with batteries, still isn’t a good fit for most data centers, she added. But it is an increasingly useful tool for speed-to-power: Projects can start with smaller interconnection requests, rely less on constrained equipment, and phase grid dependence over time, Wang said. Today, Daylight’s neocloud customers are particularly interested in leveraging behind-the-meter solar as a project accelerator.
Ultimately, that shift is part of the same trend driving massive behind-the-meter gas projects, Wang explained, which is that data centers want to “take their destiny into their own hands” when it comes to building power for the AI boom. “But we’re seeing that there’s a lot of opportunity for behind-the-meter mega-renewables projects with firming capacity,” she said. Combined with storage and phased grid service, those powered land projects are going to be “just as valuable.”
Addressing the community sentiment challenge
Even as developers scramble to solve grid constraints, opposition to data center development has rapidly become an equally important consideration. Concerns over water usage, noise pollution, and general skepticism about AI have escalated pushback into a real deal-breaker for projects across the country. And the pushback is hitting gas- and renewables-powered projects alike.
Earlier this year, Cloverleaf backed out of a proposed 500-acre data center campus project in Wisconsin, following resistance from local officials. Daylight Infrastructure is seeing similar challenges across the parcels it is vetting. In one case, Wang said, a site has a petition with 6,000 signatures opposing the development of a data center — a number significantly larger than the total population of the local county. In that case, she added, the project hasn’t been formally canceled, in part because it has support from some local officials who are still trying to move it forward.
A growing number of data center solutions providers are pitching their technology as a potential fix for the community opposition problem. But at this point, most opposition to data centers “isn’t so much about green versus dirty power,” Belizaire said, and more about the data centers themselves. The former is likely to become more of a problem if massive, off-grid gas-powered facilities actually get built, he added.
For now, social license to build is less about whether a project has a gas connection, and more about proving tangible, durable benefits, like lower electricity bills and direct investments in local infrastructure.
But public sentiment, both about AI and about fossil fuels, continues to evolve. And while there’s currently a lot of enthusiasm from major corporations about gas, if that infrastructure does get built, it will lock those companies, and the communities they build in, into decades of local pollution and climate-warming emissions. That may ultimately prove risky for hyperscalers, Janous said, pointing to his former employer Microsoft, which in June signed a 20-year PPA with Chevron for a data center in Texas.
“Historically [Microsoft] has been really leading on low-carbon, and not that they’re ignoring those goals entirely…but I don’t know how you ‘net zero’ your way out of that one,” Janous said.
Cloverleaf’s approach, of building what Janous thinks hyperscalers need, rather than what they want, advocates for minimizing gas as much as possible, and introducing other options like grid-enhancing technologies, flexibility at the data center level, and of course renewables and storage. “We’re not so Pollyannish about this that we think there’s not going to be any new gas built to support this build out — there will be,” he added. “Our preference is to the greatest extent possible that’s peaking gas.”
