Natural Gas Turbine Manufacturing Is Responding to Market Incentives

Rising demand for power from artificial intelligence (AI) and increased electrification, as well as pullbacks from wind and solar developers, portend a strong return to dispatchable thermal generation. In the Energy Information Administration’s August Short-Term Energy Outlook, electricity demand is expected to grow at an annual rate of 2.2% in both 2025 and 2026, compared with average growth of 0.8% experienced between 2020 and 2024. While solar, wind and battery storage have dominated U.S. power installations in recent years due to massive federal subsidies and state mandates, data centers require power day and night, increasing demand for highly efficient gas-fired power generation.

Climate alarmists and forced energy transformationists earlier this year argued that only renewables could meet rising demand. But, according to an article from Gas Processing and LNG, more than 100 gigawatts of new gas-fired projects have been announced. Around 120 gas-fired plants are planned by 2030 for a total capacity of around 80 gigawatts.

Manufacturing Boom

The turbine supply market for U.S. gas-fired plants is dominated by three large equipment manufacturers: GE Vernova, Siemens Energy and Mitsubishi Power. These manufacturers are expanding production by concentrating on more efficient supply chain and manufacturing protocols. Mitsubishi Heavy Industries, for example, is prepared to double its production capacity within the next two years as demand for gas turbines continues to increase. The company sees demand for gas turbines being strong for at least the next decade, as it withdraws from three Japanese offshore wind power projects because of soaring costs. The wind facilities had a projected capacity of 1.76 gigawatts and were set to start operations around 2028 to 2030. According to the company, wind turbine cost increases had far exceeded projections, including construction prices more than doubling since the 2021 bidding phase for the three facilities.

New orders for GE Vernova’s gas turbines have nearly tripled year-over-year, reaching 55 gigawatts, with 60 gigawatts of new orders expected by the end of this year. GE Vernova plans to invest more than $160 million in its Greenville plant in South Carolina to meet surging gas turbine demand. As of August, Siemens Energy had 14 gigawatts of gas turbine orders year-to-date, with 60% of those orders targeted for data centers. Siemens’ plans include a 61,000-square foot expansion of its Gibsonton, Florida, manufacturing facility, which makes blades and vanes for gas turbines. Revenue for both GE Vernova’s and Siemens’ gas turbine business is at least three times higher than a year ago.

Cost Economies

According to Gas Processing and LNG, it used to be a rule of thumb that a gas plant would cost about $1,000 per kilowatt, but those costs now are allegedly about $2,000 to $2,500 per kilowatt. However, according to the Energy Information Administration’s Annual Energy Outlook, published April 15, 2025, a natural gas combined cycle plant is still below $1,000 a kilowatt, with multi-shaft plants costing $824 per kilowatt and single-shaft plants costing $875 per kilowatt. The estimated time to construct a combined cycle gas plant is three years according to the agency, though alarmists say it can be five plus years just to deliver large gas turbines, and three to four years for smaller gas turbines. Another article has wait times for gas turbines between one and seven years depending on the model.

Dash to Gas

According to the Energy Information Administration’s Preliminary Monthly Electric Generator Inventory, developers are building gas plants and plan to add four combined cycle plants totaling 1.6 gigawatts this year. In 2026, developers plan to bring on line 3.3 gigawatts of new capacity, with over half of that capacity already under construction. Another 3.3 gigawatts of capacity are planned to come online in 2027. An additional 10.6 gigawatts are planned for 2028, as developers are in the process of obtaining regulatory approvals and equipment.

NRG Energy is joining with GE Vernova and Kiewit Corp. to build four new natural gas-fired power plants with a combined generation capacity of about 5,000 megawatts. According to POWER, the four plants will serve the ERCOT wholesale market in Texas, and the PJM wholesale market that includes 13 states in the Midwest and Mid-Atlantic along with the District of Columbia. The first facility — a 1,200-megawatt plant — is expected to begin commercial operation in 2029, with the other three plants coming online through 2032. The first plant will use two GE Vernova model 7HA gas turbines that are replicable and scalable, with the potential to fill a future pipeline of 10 to 15 gigawatts of gas capacity and expand to other areas across the United States.

Analysis

Concerns over gas turbine manufacturing appear to have been a special-interest talking point. In response to supply chain delays and turbine wait times, critics of natural gas have argued that it is ill-suited to meet the growing energy needs of data centers and electrification. Because of these delays, critics advocate for building solar and wind generation with battery backup, ignoring their intermittency, lack of dispatchability, and the fact that their tax credits and state mandates diverted capital away from building more natural gas capacity, which contributed to shortages. Clearly, changed market incentives and actual orders indicate a dash to gas.

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