US data centers have grown their power demand by 19% a year since 2000, while the electricity grid has expanded by 2% a year, according to a new analysis from insurance broker Howden.
Howden drew on data from the US Energy Information Administration and S&P Global. It found that data centers made up 5% of grid capacity in 2025, up from 0.1% in 2000. To keep expanding at the current pace without leaning harder on the grid, the firm estimated, up to 58% of data center power would need to come from other sources.
The 5% figure is worth reading next to the growth rates. Data centers are still a small slice of the total. The strain comes from one number rising about 9.5 times as fast as the other. Grid expansion is typically paid for by ratepayers, so households help fund connections that serve data centers. Gartner warned in June that power limits could halt new data center construction by 2030.
Companies are building around the grid. Anthropic said it is investing $3.4 billion in onsite gas turbines. That sidesteps the wait for grid capacity but ties its sites to natural gas, whose price has climbed as the conflict in the Middle East pushes other industries toward it. Some campuses also run banks of turbines at noise levels comparable to an international airport.
Nuclear is the other route. Palisades in Michigan, Crane in Pennsylvania and Duane Arnold in Iowa are set to receive $4.4 billion in federal grants to be recommissioned, with Microsoft and Google first in line for their power. Amazon wants 960 megawatts from 12 small modular reactors in Iowa, at a likely cost above $1 billion. Those sites are not yet approved and may not operate until the mid-2030s. The US has approved plans for the first small reactor built for a data center, in Tennessee, with each unit providing up to 300 megawatts.
The timelines do not line up. Turbines can arrive quickly but carry fuel-price risk, while reactors offer steadier supply but may come online after the 2030 date Gartner flagged. Which of those two gets built fast enough is the open question for the AI buildout.