AI - Supply Chain - More on Gas Turbines

brencronin
6 days ago
3 min read

What Are Methane Turbines, and Why Are They in the AI Spotlight?

Recent headlines about Elon Musk’s xAI "Colossus" data center in Tennessee have highlighted a sharp increase in on-site methane turbines, a term intentionally used in some media coverage to stoke environmental debate. While “methane turbines” and “natural gas turbines” refer to the same technology (since methane is the primary component of natural gas), the phrasing is often chosen to influence perception.

Why Is natural gas so popular in powering data centers?

The Colossus data center sits on a repurposed Electrolux factory site, conveniently located near an existing natural gas line. This proximity enables the facility to self-generate power without waiting for utility-scale upgrades, one of the biggest bottlenecks in rapidly scaling AI infrastructure. The diagram from the U.S. Energy Atlas highlights the general location of xAI’s data center in southwest Memphis and its proximity to major natural gas pipelines.

In Tennessee, power distribution is split between local utilities and the Tennessee Valley Authority (TVA), which supplies the broader region. TVA’s current energy mix does also include natural gas (27%) and coal (30%).

This means natural gas is not just a fallback, it's a primary power source. Interestingly, as of this writing (April 2025) only four of TVAs seven nuclear reactors are currently online. The diagram below from the U.S. Energy Information Administration shows the path of natural gas from source to consumers. By tapping into natural gas lines, the data center is becoming its own power utility. Either way the data center gets its power it is likely to be generated from natural gas turbines, and power from gas turbines is much better than power from coal.

Why So Many Turbine Trailers?

Facilities like Colossus are deploying modular gas turbines, such as the Solar Turbines SMT130 a USA based subsidiary company of Catepillar, Inc., because:

The trailer gas turbines generate much less power than larger scale gas turbines like GE Vernova turbines, so more turbines are needed.
They offer faster deployment than utility-scale options like GE Vernova’s turbines
They are readily available and more flexible for distributed power generation
They help bridge the energy gap while larger infrastructure builds (like nuclear) remain in development

Gas turbine power drive data centers are all over and growing. Example, gas turbine powered data center in Northern Virginia. I suppose a lot of companies will have to do a lot of tree planting in places like Agrabah to offset this carbon.

Speaking of GE Vernova; their large gas turbine sales are booked through 2028 as highlighted in a recent interview (April 23, 2025), with CEO Scott Strazik on Mad Money with Jim Cramer.

Natural Gas: Will be the Transitional Backbone

Natural gas turbines are quickly becoming the transitional backbone for powering AI data centers and cities. Until nuclear power and renewables scale up to meet national demand, gas turbines remain the most viable option for rapid, reliable energy. As highlighted in The Grid by Gretchen Bakke, renewables alone won’t get us to carbon neutrality. Nuclear must be part of the equation, but until that happens, natural gas will fill the gap to maintain energy independence and fuel the AI revolution.