White paper explores propane’s role in data centers

LP Gas connected with Austin Wicker, senior manager of state affairs at the National Propane Gas Association, to discuss his recently published white paper, “Powering the Digital Age: Propane’s Role in Low-Emission Data Center Infrastructure.”

What’s the story and background behind this white paper? What made you want to explore this topic?

Wicker: In December of 2024, I received an inquiry from the National Association of State Energy Officials (NASEO) in regards to propane power generation capabilities for data centers. Specifically, NASEO had expressed a growing concern from their membership on diesel proliferation in data center backup and bridge power generation, particularly in congested markets like northern Virginia. It became apparent that this was a relatively new topic for our industry, so I decided to take a deep dive to evaluate propane capabilities for data center power generation, the opportunity for the propane industry and the benefits of propane power generation for the data center industry and regulators.

What are the key takeaways from this white paper for propane retailers?

Wicker: The key takeaway for propane retailers is that data centers represent a credible, long-term growth market driven by structural changes in the U.S. power system. As AI (artificial intelligence) and cloud computing rapidly expand electricity demand, utilities are struggling with grid congestion, interconnection delays and rising costs, creating a growing need for behind-the-meter power solutions. The white paper shows that propane is well poised to meet this need as a lower-emission, reliable alternative to diesel for backup and bridge applications, particularly in markets with tight air-quality permitting and limited natural gas infrastructure. For members in states where data centers are moving, I would encourage them to become a part of the conversation. Highlighting the value and benefits of our fuel to meet this emerging need is the first critical step to entering into this market.

What does the future look like for propane regarding data centers?

Wicker: The future for propane in the data center sector can be defined by structural grid constraints, tightening emissions policy and the normalization of on-site generation. According to the Lawrence Berkeley National Laboratory, data centers consumed 4.4 percent of all U.S. electricity in 2023 and are projected to reach up to 12 percent by 2028. In markets like Virginia, data centers already make up more than 21 percent of statewide load and could exceed 30 percent by 2030. As such, data center electricity demand is growing faster than transmission infrastructure can be built, pushing developers toward behind-the-meter power as a permanent design feature, not a temporary workaround. In that environment, propane’s role expands to a core reliability fuel for backup, bridge and even potential prime generation – particularly where air permitting, community opposition to diesel or lack of traditional utility infrastructure are binding constraints.

In regard to bridge power deployments, propane’s indefinite shelf life and non-utility regulated status allow developers to monetize facilities sooner without waiting on transmission upgrades. At the same time, states are moving toward policies that require large loads to carry meaningful backup capacity or participate in grid-reliability programs, as seen in Texas and other emerging markets. Those requirements structurally favor fuels that can be stored on-site, scaled modularly and are lower emissions.

In short, propane enables data center growth where the grid cannot keep pace and offers regulators an appealing, low-emission alternative to diesel while maintaining robust reliability.

Read the full white paper at npga.org/news-resources/powering-the-digital-age-2.

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