Natural Gas Expansion Fails to Keep Pace with Soaring Demand

The development of natural gas power in the US is accelerating, but it may not keep up with growing demand, which could lead to higher electricity prices for rural consumers. According to CoBank energy economist Teri Viswanath, announced projects may arrive more slowly than required by increasing demand. Gas-fired capacity under development has tripled in two years due to rising demand from data centers, artificial intelligence infrastructure, and industrial expansion.

New plants face several challenges, including turbine shortages, congested interconnection queues, limited pipeline access, and higher construction costs. These barriers could tighten reserve margins and increase scarcity pricing during periods of heavy demand. Electric cooperatives may also face pressure as large industrial customers seek faster connections.

CoBank suggests that diversified power purchasing, staged investments, load management, and rate structures assigning costs to large users could limit household exposure. Rural communities will watch whether proposed plants reach construction, whether fuel and transmission capacity expand, and how utilities divide costs between farms, households, and new industrial loads.