IEA has forecast US-based spending on power plants fuelled by coal and gas to reach $50bn this year - FT

The International Energy Agency (IEA) has projected that U.S. investment in coal- and gas-fired power plants will reach USD 50 billion in 2026, driven by the rapid expansion of data centres and the increasing demand for electricity to support artificial intelligence (AI) operations. This surge in fossil-fuelled power plant spending is expected to surpass China’s investment in similar infrastructure during the same period, marking a significant shift in global energy investment patterns.

The rise in U.S. gas-fired power plant approvals is attributed to the urgent need to meet electricity demand from the growing data-centre sector, which requires reliable and scalable energy sources. In contrast, China’s investment anticipated to decline due to domestic policy adjustments and external factors such as geopolitical tensions affecting gas prices.

This trend aligns with broader global energy investment dynamics, where the U.S. and the Middle East accounted for nearly half of the Final Investment Decisions (FID) for new gas-fired power projects in 2025. The U.S. has also seen a resurgence in natural gas power development, supported by its short investment cycle and recent technological and operational efficiencies.

However, the long-term trajectory of fossil fuel investments remains uncertain amid evolving regulatory environments, climate goals, and the increasing competitiveness of clean energy technologies. While the U.S. is currently experiencing a boost in fossil-fuelled power spending, renewables and low-emissions technologies outpace fossil fuel investments overall.