US datacenters are increasingly turning to coal power due to rising natural gas prices and surging electricity demand driven by AI workloads. This shift represents a significant reversal for climate goals, as coal generation has increased nearly 20% year-to-date, with Jefferies, a financial services firm, projecting this trend will continue through 2027 as operators race to bring new capacity online during the expected 2026-2028 demand surge.
What you should know: The datacenter boom is forcing utilities to extend the life of coal plants they had planned to decommission.
- In Omaha, one power company reversed plans to stop burning coal, citing the need to serve nearby datacenters and avoid power shortages in the district.
- Natural gas-powered turbines had been the preferred choice for datacenter energy, especially for on-campus generation, but current gas prices have made this option less economically attractive.
- Jefferies raised its coal generation estimate by approximately 11%, “driven by higher capacity factors, and staying elevated through 2027 on favorable fuel pricing vs gas (particularly for existing fleet).”
The environmental impact: This coal resurgence threatens global climate commitments and dramatically increases datacenter carbon emissions.
- A 2024 Morgan Stanley report projected that datacenters will emit 2.5 billion tonnes of greenhouse gases worldwide by 2030 — triple the emissions that would have occurred without generative AI development.
- Greenpeace, an environmental campaign group, has characterized coal as “the dirtiest, most polluting way of producing energy.”
- Continued coal combustion affects local air quality near power plants and hinders broader efforts to reduce greenhouse gas emissions.
Policy challenges: The current federal administration is prioritizing energy availability over renewable development for AI competitiveness.
- The Trump administration has frozen approval processes for wind energy projects and announced restrictions on new solar and wind power projects, citing land use and cost concerns.
- This contrasts with research indicating renewable energy could power datacenters at lower cost than fossil fuels or emerging technologies like small modular reactors.
What they’re saying: Government officials are framing energy access as a national security priority over climate concerns.
- “The real existential threat right now is not a degree of climate change. It’s the fact that we could lose the AI arms race if we don’t have enough power,” US Interior Secretary Doug Burgum told a natural gas industry event last month.
- Secretary of Energy Chris Wright stated: “The Trump administration will treat climate change for what it is, a global physical phenomenon that is a side effect of building the modern world.”
Why this matters: The tension between AI development and environmental goals highlights the challenge of balancing technological advancement with sustainability commitments, as developers prioritize getting facilities online quickly with whatever power sources are immediately available.
Recent Stories
DOE fusion roadmap targets 2030s commercial deployment as AI drives $9B investment
The Department of Energy has released a new roadmap targeting commercial-scale fusion power deployment by the mid-2030s, though the plan lacks specific funding commitments and relies on scientific breakthroughs that have eluded researchers for decades. The strategy emphasizes public-private partnerships and positions AI as both a research tool and motivation for developing fusion energy to meet data centers' growing electricity demands. The big picture: The DOE's roadmap aims to "deliver the public infrastructure that supports the fusion private sector scale up in the 2030s," but acknowledges it cannot commit to specific funding levels and remains subject to Congressional appropriations. Why...
Oct 17, 2025Tying it all together: Credo’s purple cables power the $4B AI data center boom
Credo, a Silicon Valley semiconductor company specializing in data center cables and chips, has seen its stock price more than double this year to $143.61, following a 245% surge in 2024. The company's signature purple cables, which cost between $300-$500 each, have become essential infrastructure for AI data centers, positioning Credo to capitalize on the trillion-dollar AI infrastructure expansion as hyperscalers like Amazon, Microsoft, and Elon Musk's xAI rapidly build out massive computing facilities. What you should know: Credo's active electrical cables (AECs) are becoming indispensable for connecting the massive GPU clusters required for AI training and inference. The company...
Oct 17, 2025Vatican launches Latin American AI network for human development
The Vatican hosted a two-day conference bringing together 50 global experts to explore how artificial intelligence can advance peace, social justice, and human development. The event launched the Latin American AI Network for Integral Human Development and established principles for ethical AI governance that prioritize human dignity over technological advancement. What you should know: The Pontifical Academy of Social Sciences, the Vatican's research body for social issues, organized the "Digital Rerum Novarum" conference on October 16-17, combining academic research with practical AI applications. Participants included leading experts from MIT, Microsoft, Columbia University, the UN, and major European institutions. The conference...