Big Tech Bets on Gas as SMR Nuclear Timelines Slip
Big tech's approach to powering its AI data centers is shifting faster than many expected, and natural gas, not nuclear, is doing most of the near-term work. Amazon is building a 7.65 GW off-grid gas project in Texas, Meta is spending $10 billion on a Louisiana site running on three onsite gas turbines, and Oracle's Stargate project in Abilene, Texas will draw 4.5 GW from a dedicated onsite gas facility. xAI went further still, installing gas turbines at its Memphis site in just 122 days. Analysts at Enverus expect hyperscalers to spend around $5 trillion through 2030 adding 62 GW of off-grid gas capacity, concentrated heavily in Texas, Pennsylvania and Ohio.
The reasoning is straightforward: speed. Grid interconnection queues now run years long, and tech companies are, in the words of one industry researcher, constrained entirely by time-to-power rather than how quickly they can put up the building itself. A gas plant can be built in around five years, and some are already running, while nuclear and solar projects can take decades. One energy analyst described the shift plainly as a matter of necessity rather than climate strategy.
That doesn't mean nuclear has fallen out of favour, it's just been pushed further down the timeline. Microsoft, Amazon, Google and Meta have collectively committed roughly 10 GW of nuclear capacity and more than $100 billion in related investment. But most new-build small modular reactors, from developers like Kairos Power, X-energy and TerraPower, are targeting first commercial operation in the early 2030s, and even the furthest-along project has only just secured its construction permit. The nearer-term nuclear power these companies are actually banking on comes not from new SMRs but from restarting existing large reactors, such as Microsoft's deal to bring Three Mile Island back online around 2027-2028.
The overall pattern is becoming clear. Gas is covering the immediate power gap because it can be built now. Restarted legacy nuclear plants are filling the next few years after that. New-build SMRs sit further out still, more a long-term bet on future low-carbon capacity than a solution to today's power shortage. For now, at least, it's gas turbines rather than reactors that are keeping the AI boom's data centers running.