The CEO of Hunt Energy, Hunter Hunt. Last week, officials from the Trump administration who strongly support energy dominance gathered in Houston to celebrate how American natural gas is helping the U.S. maintain its lead in the AI race. However, voices from the West Coast tech sector argue that relying solely on natural gas to preserve this advantage is risky.
The event was the CERAWeek energy conference, hosted by S&P Global—the world's largest and most influential gathering of energy leaders. Cabinet secretaries and CEOs of oil and gas producers, utility companies, and pipeline operators took turns emphasizing that cheap natural gas, combined with America's distance from conflict zones in the Middle East, makes the country an ideal location for large-scale AI projects.
Yet the Silicon Valley leaders who are actually funding these AI initiatives prefer to diversify risks through renewable energy, batteries, and nuclear power. Even setting climate concerns aside, some worry that by the time new gas-fired power plants come online, natural gas prices may have risen, driving up household electricity bills and sparking a political backlash against AI.
Having attended CERAWeek for many years, I found this year's edition particularly significant—because the direction of capital flow is now being dictated not by energy giants, but by major technology firms. In Houston, the energy capital, companies like Microsoft, Alphabet, and data center developers such as Crusoe were sponsoring forums and hosting dinners as frequently as Chevron. (In fact, Crusoe and Microsoft just finalized an agreement last Friday to build a data center in Abilene, Texas.)
While energy and tech executives increasingly agree on the necessity of critical infrastructure, their approaches sometimes clash. Toby Neugebauer, a supporter of Trump who plans to build a massive data center project in Amarillo, Texas, debated Amanda Peterson Corio, Alphabet’s global energy lead, over the ideal energy sources for AI.
Neugebauer told the audience that for power on the scale required by “companies like Alphabet,” there are only two options: natural gas or nuclear power. Corio disagreed.
“Even if we started building nuclear power today, we wouldn’t have it for a decade because we haven’t invested in talent, supply chains, and all the necessary components,” she stated plainly. “And if we rely only on natural gas, we’ll also run into trouble,” due to supply chain bottlenecks in the gas sector.
Corio noted that the energy mix planned by Alphabet for a data center in Minnesota—including wind, solar, and a new 100-hour battery storage system—could be deployed much faster. “We have to change our mindset,” she emphasized. To be fair, Alphabet also plans to use some natural gas and is supporting nuclear power, including restarting a shut-down reactor in Iowa, developing next-generation small modular reactors, and even pursuing nuclear fusion. But Corio is correct: it will still take years for new nuclear power to be deployed at scale.
Bobby Hollis, Vice President of Energy at Microsoft, told a packed session that while tech companies are often seen as focused solely on renewables, Microsoft intends to adopt a diversified energy strategy, including nuclear, hydroelectric, and carbon removal technologies. The company also acknowledges that “fossil fuels will remain part of our energy mix for a long time.” In a separate interview, he told me that modernizing the grid is equally urgent. Simple upgrades like reinforcing utility poles and strengthening lines against storms “often don’t get as much attention as building new power plants,” but are just as important.
While data center developers currently find natural gas quick to build, they are actively exploring new solutions. Darryl Willis, who leads a team at Microsoft, helps clients like Aalo Atomics use AI to reduce the time spent on permitting and other tedious paperwork. “Technology can truly help us reimagine the energy landscape,” he told me.
Over-reliance on natural gas in the future could prove counterproductive.
The U.S. natural gas market is largely isolated from global markets, with domestic prices far lower than what consumers pay in Europe and Asia. The reason is that those countries lack their own natural gas supplies and must pay high prices for liquefied natural gas shipped across oceans via tankers.
Uncertainty in natural gas supply has increased significantly following U.S. military engagement with Iran. Attacks by Iran damaged gas export facilities, which may take years to restore. U.S. natural gas exports are already near capacity, but exporters plan to more than double the country’s liquefaction capacity by 2029. This means global buyers could soon compete with domestic users for supply, driving up prices.
Although producers could increase output to mitigate price hikes, this shift could still alter the profitability of data centers that depend heavily on natural gas.
AI companies plan to use natural gas for 75% of the power generated at on-site plants in their self-built campuses. The U.S. government is also pushing to expand natural gas use. Just before CERAWeek, allies like Japan announced they would respond to Trump’s call by building the largest gas-fired power plant in history to support AI computing centers.
Tech companies must also prepare for scenarios where Democrats retake the White House, or where various electricity and gas infrastructure projects become mired in regulatory delays.
A growing number of oil and gas industry figures are also calling for energy diversification. Hunter Hunt, CEO of Hunt Energy and a scion of an oil family, has invested in grid transmission, batteries, and new solar technologies. Speaking at the final roundtable of CERAWeek, he warned that the U.S. is becoming overly mired in partisan political disputes. “We’re fighting about everything,” he said. Increasing energy supply through renewables and new technology, he argued, is what truly embodies a “wartime mentality.”
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