The Future of U.S. Natural Gas Power Generation: Projections, Accuracy, and the Confluence of Limiting Factors to 2030

Executive Summary

1.1 Overview of Projections and Core Findings

An analysis of U.S. energy market trends and projections indicates a notable ambition for future natural gas power generation. A key projection from the firm Enverus suggests the United States is on a trajectory to construct 80 new natural gas power plants by 2030, which would add an estimated 46 gigawatts (GW) of new capacity. This figure is a focal point for assessing the future of the nation’s energy infrastructure. However, a comprehensive review of the current market and regulatory landscape reveals that this aggressive projection is highly speculative. It is a needs-based assessment rather than a realistic forecast of what can be built, as its feasibility is called into question by a complex and multi-faceted set of constraints.

1.2 Key Drivers vs. Limiting Factors

The fundamental premise of this report is a paradox between a rising need for power and a difficult environment for new construction. The primary driver of this renewed interest in natural gas is an unprecedented surge in electricity demand, particularly from the artificial intelligence (AI) sector. Data centers are forecast to account for a significant portion of future load growth, creating a critical need for reliable, dispatchable power. This pressing demand is creating market signals that are driving the projections for new gas plant construction.

However, a confluence of powerful limiting factors is impeding the flow of capital and the pace of project development. These constraints include escalating capital costs, supply chain bottlenecks, a strong competitive disadvantage from renewables, increasing regulatory hurdles, and growing socio-political opposition. These factors collectively make it increasingly difficult and financially risky to build new gas plants, preventing the widespread buildout that would be required to meet the 46 GW projection.

1.3 The Inherent Uncertainty of Forecasts

It is essential to contextualize these projections as modeled scenarios rather than certain predictions of the future. Forecasts from entities like the U.S. Energy Information Administration (EIA) are described as “projections of what may happen given certain assumptions and methodologies”. These models are often policy-neutral, assuming no changes in current laws and regulations, which is an unrealistic assumption in a dynamic system. Academic and retrospective analyses of past energy forecasts confirm their limitations, noting that projections can “deviate massively” in the medium and long term, with the accuracy of forecasts being particularly “spotty beyond five years”. This inherent uncertainty suggests that any specific projection, including the 46 GW figure, should be viewed as a baseline for discussion rather than a definitive outcome.

Projections for New Gas Plant Capacity in 2030

2.1 Aggregate Projections and Recent Trends

According to an analysis by Enverus, the U.S. is “on track to build 80 new natural gas power plants by 2030, adding 46 gigawatts (GW) of capacity”. This figure represents a substantial planned expansion of the nation’s gas-fired electricity fleet. However, this projection stands in stark contrast to recent historical trends and near-term forecasts.

In 2024, the U.S. added only 2 GW of new gas capacity, which was the lowest level since 2000. Projections for the near-term period of 2025-2026 suggest a modest increase, with natural gas expected to contribute only 10.1 GW, accounting for a mere 8% of all new capacity additions during that time frame. The significant discrepancy between the minimal recent additions and the ambitious 46 GW projection for 2030 underscores a deep market disconnect. The Enverus projection appears to reflect a perceived necessity to meet a looming energy shortfall driven by the demand from AI and data centers. It is more likely a strategic declaration of what needs to be built to maintain grid stability than a realistic extrapolation of current construction rates. To reach 46 GW by 2030, an average of approximately 7 GW per year would need to be added after 2026, a pace that is historically unprecedented and highly improbable given the severe limiting factors detailed later in this report.

2.2 Specific Plant Announcements and Associated Capacity

The primary driver behind the renewed interest in natural gas is the rapidly escalating energy demand from data centers and the AI sector. The EIA forecasts that data centers will use between 6.7% and 12% of total U.S. electricity by 2028, a significant increase from 4.4% today. This rapid and geographically concentrated demand is fundamentally altering load growth curves and driving the need for new, reliable, and dispatchable power sources. Specific projects are being announced to meet this new demand. For example, NRG Energy has announced plans for four new gas plants in Texas and the Mid-Atlantic by 2029, slated to provide 1.2 GW of capacity specifically for AI data centers. Similarly, Entergy is constructing “several gigawatts” of new gas plants in Louisiana and Mississippi to supply power to data centers for companies like Meta and Amazon. We Energies in Wisconsin is also proposing a $2 billion investment to support a Microsoft AI hub. Global Energy Monitor estimates that approximately 38 GW of captive gas plants, which are roughly a quarter of all such projects, are in development to directly power data centers. This direct, causal relationship between the “AI boom” and new natural gas plant development is the key market signal informing the ambitious projections.

The following table provides a comparative overview of various U.S. new gas plant projections and related metrics.

Source	Timeframe	Capacity (GW)	Number of Plants	Context / Key Assumption
Enverus	By 2030	46 GW	80	Needs-based projection for new dispatchable capacity
Enverus (Implied)	Annually after 2026	∼7 GW	∼10-12	Pace required to meet 2030 projection
EIA/Visual Capitalist	2025-2026	10.1 GW	N/A	Short-term capacity additions
Goldman Sachs	By 2030	∼3.3 bcf/d gas demand	N/A	Assumes 60% of new generation is gas to support data centers
Global Energy Monitor	In Development	38 GW	N/A	Captive gas plants to power data centers

The Inherent Uncertainty and Limited Accuracy of Projections

3.1 The Nature of Energy Forecasts

Projections for energy supply and demand are not predictive outcomes but rather analytical tools. Entities such as the EIA are legally mandated to produce policy-neutral forecasts that are based on the assumption that current laws and regulations will remain unchanged. This methodology means the forecasts are not designed to account for dynamic policy shifts or technological breakthroughs, which are common in the energy sector. For this reason, the EIA openly states that the value of its projections “is not that they are predictions of what will happen, but rather, they are modeled projections of what may happen given certain assumptions and methodologies”. This distinction is crucial; it means a projection of 46 GW is not a guarantee but a scenario that holds only if certain conditions remain static.

3.2 A Retrospective on Forecasting Accuracy

Academic research on the accuracy of past EIA forecasts reveals that they “deviate massively in the medium and long-terms,” with a track record that is “spotty beyond five years”. The sources of these inaccuracies are rooted in incorrect assumptions, particularly concerning macroeconomic trends and policy changes. For instance, earlier reports from the EIA severely underestimated projected wind and solar output due to their models’ inability to account for a rapidly evolving clean energy legislative landscape and falling technology costs.

The very act of publishing a forecast can introduce a complex dynamic in the energy system. A projection that signals a looming supply gap, such as the 46 GW figure, could be intended to encourage investment to prevent a future shortfall. Conversely, if a forecast is perceived as having a bias, it can actively discourage investment. The IEA, for example, has been criticized for underestimating oil demand, which the Trump administration argued discouraged needed investment in fossil fuel production capacity. This demonstrates how projections are not passive observations but rather active elements within a complex system of market signals and stakeholder decisions. Therefore, the 46 GW projection must be interpreted as a strategic starting point for discussion about the future of the grid, rather than a definitive statement of what will be built.

Limiting Factors to New Gas Plant Development by 2030

4.1 Economic and Financial Impediments

4.1.1 Escalating Capital Costs and Supply Chain Bottlenecks

The most immediate and material constraint on new gas plant construction is a drastic escalation in capital expenditures (CapEx) and persistent supply chain bottlenecks. According to NextEra Energy CEO John Ketchum, the cost to build a gas-fired combined-cycle unit has tripled, from $785/kW in 2022 to $2,400/kW today. This dramatic increase is attributed to a multi-year backlog in manufacturing for critical equipment, with wait times for new gas turbines now spanning four to six years. The CEO notes that this bottleneck makes gas plants a solution for “2030 or later”.

This physical limitation on new construction extends beyond gas plants themselves to the broader electrical grid. The “AI energy race” is placing extraordinary pressure on the power grid, which is already burdened by aging infrastructure. Data center operators are procuring the same electrical equipment, particularly utility-scale transformers, that are needed for grid upgrades. This has led to wait times as long as six years for these components and price increases of 26% in 2024. The wait time for grid connection itself is now one to three years, with a backlog of 205 GW of solar and wind capacity waiting to connect. The fundamental physical limitations of the supply chain make it highly unlikely that the U.S. can add 46 GW of new gas capacity and the associated transmission infrastructure by 2030.

4.1.2 Competitive Disadvantage from Renewables

Even with rising demand, new natural gas plants face a strong competitive disadvantage from renewable energy sources. Lazard’s 2025 “Levelized Cost of Energy+” report confirms that unsubsidized solar and wind remain the “most cost-effective forms of new-build energy generation” in the U.S.. The report also highlights a growing cost disparity: the LCOE of utility-scale solar dropped by 4% in 2025, while the LCOE of combined-cycle gas increased by 3%.

This economic reality is on display in Texas, a state that attempted to incentivize new gas plant construction through a $7.2 billion fund offering low-interest loans. Despite this legislative support, companies have been pulling their applications, citing profitability concerns and the dominance of cheaper, quicker-to-deploy solar and storage. This example demonstrates that market signals are more powerful than policy incentives; a deregulated market that favors the least-expensive power will not attract private capital to projects that are not financially competitive.

4.1.3 Natural Gas Price Volatility and Investment Risk

The inherent volatility of natural gas prices introduces a significant financial risk for investors and lenders, often increasing the cost of capital for new projects. A core reason for this increased risk is the evolving role of gas plants within the transitioning grid. As more intermittent renewable energy comes online, natural gas plants are increasingly dispatched not for baseload power but as flexible backup generation to compensate for fluctuations in wind and solar. This means a new gas plant will have a lower capacity factor and will be dispatched less frequently, which makes the financial model less attractive for long-term investment as the plant must be built and financed but will generate less revenue. This financial instability, when combined with high capital and fuel costs, makes new gas plants a highly risky proposition for investors.

4.2 Regulatory and Policy Barriers

The path to building a new gas plant in the U.S. is a difficult regulatory gauntlet. New baseload gas plants are now required by the EPA’s Clean Air Act standards to control 90% of their carbon pollution, based on the application of carbon capture and sequestration (CCS) technology. This mandate adds considerable cost and technical complexity to any new project.

At the state level, 16 states have adopted 100% clean energy standards (CES), and 29 states have renewable portfolio standards (RPS). These policies create a market for renewable energy credits and actively disincentivize new fossil fuel generation by prioritizing and subsidizing clean sources.

Furthermore, the federal and state permitting processes are significant hurdles. The complex Federal Energy Regulatory Commission (FERC) permitting process for gas infrastructure can add years to a project’s timeline. The interconnection queues for new power plants to connect to the grid are also lengthy, with advanced-stage projects waiting years for approval. The combined effect of these regulatory burdens is a powerful deterrent to new construction that makes a 2030 timeline highly improbable for most projects.

4.3 Socio-Political and Community Opposition

Community opposition to new gas plants is no longer a “soft” factor but a material risk to project viability. This is especially true in communities that have been historically overburdened by pollution. A growing number of regulatory decisions are referencing community health and environmental justice concerns in their analyses of proposed projects. For example, regulators in Arizona rejected a proposed gas plant, citing “significant negative health consequences for local communities already suffering environmental injustice”. In Oxnard, California, community pushback against a proposed gas peaker plant led the utility to instead build a portfolio of demand response and storage solutions. These cases demonstrate a paradigm shift where community concerns are being codified into formal regulatory risk, adding a powerful non-economic limiting factor to new gas plant development.

The following table systematically outlines the key limiting factors and their impact on new gas plant feasibility.

Factor Category	Specific Factor	Description of the Constraint	Impact on Project Feasibility	Supporting Research
Economic	Escalating Capital Costs	Cost to build a gas combined-cycle plant has tripled to $2,400/kW.	Increases project cost and reduces financial viability.
Economic	Supply Chain Bottlenecks	Multi-year backlogs for gas turbines and grid transformers.	Delays project timelines by 4-6+ years; makes 2030 target infeasible.
Economic	Competitive Disadvantage	New solar and wind are consistently cheaper than new gas on an LCOE basis.	Reduces market share and profitability of new gas plants in competitive markets.
Financial	Price Volatility	Natural gas prices are volatile, increasing investment risk and cost of capital.	Lenders and investors demand higher returns, making projects less attractive.
Regulatory	EPA Clean Air Act	Final rule requires new baseload gas plants to control 90% of carbon pollution with CCS.	Adds significant cost and technical complexity to projects.
Regulatory	State Clean Energy Standards	16 states have 100% CES and 29 have RPS policies.	Actively disincentivizes fossil fuel generation and prioritizes renewables.
Regulatory	Permitting & Interconnection	Lengthy FERC permitting and multi-year interconnection queues.	Adds years to project timelines; creates a backlog that is physically difficult to clear.
Socio-Political	Community Opposition	Growing legal and regulatory precedent for rejecting projects based on community health and environmental justice concerns.	Introduces non-economic risks that can lead to project rejection or cancellation.

The Dynamic Context: A Confluence of Forces

5.1 The Paradox of Rising Demand

The core tension in the U.S. power sector is the paradox of rising demand against a difficult environment for new construction. The scale and speed of anticipated AI-driven electricity needs are putting “extraordinary pressure on the power grid,” which is already facing reliability threats. The Enverus projection of 46 GW is an acknowledgement of this looming shortfall. However, the economic, regulatory, and socio-political environment is making it increasingly difficult to build the gas plants that are seen as a near-term solution to this problem. This suggests a systemic market failure, where the need for new dispatchable capacity exists, but the financial risks and practical hurdles are too great for private investment to fill that need at the required scale. This “investment chasm” implies that the U.S. will either fail to meet its demand or be forced to rely on more aggressive policy interventions or an accelerated deployment of still-maturing technologies like long-duration storage and small modular reactors.

5.2 The Evolving Role of Natural Gas

The role of natural gas is undergoing a fundamental shift in the U.S. energy landscape. Historically, it has been a dominant baseload source, but it is increasingly transitioning to a flexible, transitional fuel and a critical backup for intermittent renewables. While natural gas can quickly ramp up and down to stabilize the grid and displace older, more polluting coal plants, this new role comes with significant investment challenges. The need to build a new plant that will be dispatched less frequently introduces a financial instability that private capital is reluctant to accept. This evolving role, coupled with the myriad limiting factors, suggests that the future for natural gas is not one of robust expansion but rather one of strategic, targeted deployment in regions and for purposes where its flexibility is an absolute necessity.

Conclusion and Forward-Looking Insights

The projection for 46 GW of new natural gas capacity from 80 plants by 2030, while representing a perceived need in the face of rapidly rising electricity demand, is highly improbable. The primary driver for this demand—AI data centers—is real, but the environment for building new gas plants is defined by overwhelming constraints.

The numbers themselves tell a compelling story of a market under duress. The long-term projection of 46 GW stands in stark contrast to the mere 2 GW of capacity added in 2024. The fundamental contradiction lies between the industry’s acknowledgement of a future reliability crisis and its inability to overcome the significant hurdles preventing new construction. These barriers—including tripling capital costs, multi-year supply chain backlogs, a strong competitive disadvantage from cheaper renewables, and a complex web of regulatory and community opposition—are not easily surmountable.

Ultimately, the analysis suggests that while natural gas remains a critical component for grid stability in the near-to-medium term, its future is increasingly limited. The financial and practical risks of building new gas plants are making them an unattractive option for private investment, particularly in comparison to the declining costs and rapid deployment of renewables and battery storage. The U.S. power sector is in a period of profound transition, and the 2030 projections for natural gas will likely be a casualty of the very market forces and policy decisions that are driving the move towards a cleaner, but far more complex, energy future.

Sources used in the report

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