Mitsubishi Heavy Industries to Double Gas Turbine Capacity

Bad-faith arguments for wind, solar, and storage hardest hit

You have to give wind and solar advocates some credit; they are an opportunist bunch of scallywags.

Having abandoned their calls for more wind and solar to avert the impending climate crisis, for the last several months wind and solar advocates have claimed that a backlog of orders for natural gas turbines and the long lead time to build new nuclear power plants meant the only way to quickly meet the growing electricity demand was to double down on wind, solar, and battery storage deployment.

They’ve even argued that President Trump’s actions to initiate an earlier phase-out of the Inflation Reduction Act subsidies and impose Foreign Entities of Concern (FOEC) stipulations on subsidy eligibility would cause electricity prices to rise and strangle artificial intelligence (AI) in its crib due to a lack of power.

Welp, that turned out to be a load of malarkey. Sorry,

Doug Lewin

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Mitsubishi Doubles Up On Gas Turbines

On Tuesday, September 2nd, Mitsubishi Heavy Industries, one of the largest gas turbine producers in the world, announced it will double its production capacity for gas turbines within the next two years as demand for the technology continues to increase.

According to Power Magazine, Mitsubishi was initially working towards boosting production capacity by 30 percent, but the company realized it would not be enough to meet the surging demand for gas turbines.

This highlights the realization that many energy-realists acknowledge: you can’t cost-effectively power electricity demand growth using inefficient and unreliable wind, solar, and battery storage facilities. What we need is dispatchable power.

Bloomberg reports the capacity expansion could help run down the $35.6 billion order backlog at MHI’s energy unit, and provide room to take in more orders.

More Gas to Meet Data Center Demand

An analysis released this week by Wood Mackenzie estimates that U.S. utilities have committed to 116 gigawatts (GW) of large load capacity additions —read, data centers— in the coming years, which is the equivalent of 15.5 percent of the current peak demand in the United States.

WoodMac expects 60 GW of new capacity to come online by 2030, and 93 GW to be operational by 2035. Bloomberg estimates U.S. data centers could consume 2.4 times more power in 2035 than they are projected to consume in 2025, meaning they may consume about 10 percent of total U.S. consumption in 2024 by the middle of the next decade.

Powering these data centers will require a significant amount of new dispatchable capacity, such as natural gas, and recent trends indicate that the industry is recognizing this.

According to the Global Energy Monitor (GEM), natural gas plants in the construction, pre-construction, and announced phases have skyrocketed since the beginning of last year. The data show only 35 GW of natural gas capacity in these phases in the first half of 2024, skyrocketing to approximately 162 GW in the first half of 2025.

Not all of these announced projects will be built, but the 4x increase in prospective capacity in the United States shows companies are serious about meeting the demand for data centers, and they are serious about natural gas.

Gas Capacity Decriminalized

Unfortunately, this new capacity was not always a foregone conclusion due to the significant roadblocks set up against natural gas and other thermal power plants.

The greenhouse gas regulations on new natural gas power plants promulgated by the Biden administration would have greatly undermined the economics of building new natural gas facilities by requiring any plant operating above a 40 percent capacity factor to install unproven and expensive carbon capture and sequestration equipment.

Last year, before data centers took center stage in the energy debate, industry sources told us that these regulations would be a major impediment to financing new gas projects.

Such regulatory headwinds almost certainly played into the economic calculus of big players like Mitsubishi, which would not be inclined to spend billions of dollars expanding production capacity if they thought their product would be effectively outlawed.

However, the proposed repeal of these rules by the Trump administration will go a long way toward restoring confidence among turbine manufacturers that it’s worth investing in expanding their production capacity—which also means investing in the growth of the American economy.

Conclusion

Mitsubishi’s announced expansion of its production facilities is not a magic bullet that will automatically end the wait times for new gas facilities, but it shows that markets can respond to incentives when government regulators are not intent on destroying the economic viability of the product in question.

This is excellent news for the grid and the American energy user (who will benefit from lower-cost and more reliable natural gas facilities), and horrible news for the bad-faith arguments suggesting we need to build unreliable generators to meet the growing demand for data centers.

The notion that wind, solar, and storage would be integral to meeting the surging demand for data centers has always seemed suspect, as we are unaware of any data center operators willing to operate intermittently.

This means that there will be ample opportunity for reliable generators of all flavors in the coming years if data center demand is a real thing and not the next bubble.

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Capacity “Out of Thin Air” is Quite Hard by

F. Ichiro Gifford

. This has become one of Isaac’s favorite substacks. It’s well written and provides the insight of an insider in the utility industry. Definitely worth subscribing to.

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