July 30, 2026
Data center development in the United States has slowed, according to a new report. However, capacity continues to grow at a slower pace.
Developers added 36 GW of new data center capacity to the US pipeline in the first quarter of 2026, according to a new report from Wooden Mackenzie. The number of new data centers fell 19% from Q4 2025 as the analysis showed established developers shifting focus to their existing project pipelines in a more challenging development and regulatory environment.
Cumulative US data center capacity now stands at 331 GW, of which approximately 40% is in active development, according to Wood Mackenzie’s US Data Center Pipeline Q2 report.
“Established data center developers continue to shift their focus to maturing their existing pipelines in the face of an increasingly challenging development and regulatory environment,” said Caitlin Connelly, senior analyst at Wood Mackenzie. “New entrants focused on gas supply and land access are targeting states like Texas and Utah, but only a small portion of those projects are actively being developed.”
Development continues to grow, but at a slower pace
The 36 GW added in the first quarter of 2026 represents a 19% quarter-on-quarter decline, continuing a sustained slowdown that has now lasted three consecutive quarters, Wood Mackenzie reports. Quarterly additions peaked at over 60 GW in Q3 2025, before declining in Q4 2025 and declining further in Q1 2026.
Texas leads all states in cumulative planned capacity, which now totals almost 100 GW, with Ohio maintaining its position as the second largest market. Massive sites are also being planned in states such as Utah, New Mexico and West Virginia, where land availability is a major draw, although only a small portion of these projects have entered active development.
Although 53% of projects have now passed the permitting phase, this cohort represents only 32% of total pipeline capacity, highlighting the gap between the number of projects and scale. Projects that start in 2026 will have a lower energy density than projects in earlier phases.
The utility obligations exceed 195 GW
The large load capacity with signed construction or electricity supply agreements now totals 195 GW, equivalent to 26% of the US peak load in 2025, the report said. One of the most telling signals of the pipeline’s maturity is the sharp growth in the advanced discussion stages, expanding from 37 GW in the fourth quarter of 2025 to 107 GW in the first quarter of 2026, indicating that early-stage projects are moving toward signed commitments. At the same time, uncommitted capacity increased significantly in the quarter, primarily driven by utilities in ERCOT.
Of the high-reliability burden, commitments from cable-only utilities represent 51% of the commitments from high-reliability utilities. However, the composition of total liabilities varies considerably by region. At PJM, over a third of utility commitments are classified as highly reliable, while at ERCOT, 86% of commitments remain speculative or in early study stages. This imbalance leaves PJM most exposed to the risk of its high-capacity pipelines exceeding what the reliable generation queue can support.
Capex breaks $1 trillion milestone
Disclosed investments related to specific projects exceeded the $1 trillion USD threshold in the first quarter of 2026, although Wood Mackenzie says this figure is heavily distorted by a small number of large, speculative developments. Just 6% of projects account for 42% of total investment, underscoring how concentrated investment has become at the top of the market. Costs per MW declined in the first quarter of 2026, continuing the turnaround from highs in the second half of 2025, and costs per square meter also declined after peaking in 2025. Average square footage for buildings is rising even as total campus square footage declines, signaling a broader industry shift toward fewer, larger and more capital-intensive facilities.
Generation strategies around the meter are gaining ground
A growing number of pipeline projects are announcing around-the-meter (ATM) generation strategies, and the trend is most pronounced in Texas, where strong gas supply, faster permitting times and a robust renewable energy market are creating favorable conditions. Among publicly disclosed deployments around the meter, gas accounts for 40% of projects and 48% of total site capacity, while renewables and storage represent 41% of deployments and 38% of capacity – a balance that reflects both the urgency of securing energy and a longer-term interest in a cleaner supply.
“Regulations for data center development are becoming increasingly complex and regionally diverse. Interruptible service options are being deployed, forcing companies to choose between speed-to-power and robust power,” says Connelly. “Policymakers tend to view fixed services as an unnecessary obstacle to interconnection.
“Fast-track capacity interconnection frameworks seek to bring the next generation online quickly before a supply crisis. However, it remains to be seen whether policy developments help or hinder demand growth as policymakers try to balance the often competing priorities of affordability and speed to power.”
Tags: AI, data centers, Wood Mackenzie
