India has become the world’s fourth-largest market for liquefied natural gas (LNG) regasification capacity after expanding its import infrastructure in 2025, according to the International Gas Union’s (IGU) World LNG Report 2026.

The report says India’s total LNG regasification capacity reached 52.5 million tonnes per annum (mtpa) by the end of 2025, after adding 7.1 mtpa during the year. The increase helped India overtake Spain in global rankings.

The additional capacity came from two projects: the 5 mtpa Chhara LNG terminal in Gujarat and the completion of a breakwater at the Dabhol LNG terminal in Maharashtra, which added 2.1 mtpa by allowing the terminal to operate throughout the year.

LNG is natural gas that is cooled into a liquid so it can be transported by ship. Once it reaches India, it is converted back into gas at regasification terminals and supplied to industries, fertiliser plants, refineries and city gas networks.

Supporting India’s growing energy needs

India’s demand for energy is rising as industries expand and cities grow. Since domestic natural gas production is not enough to meet demand, the country imports a large share of its gas as LNG.

More regasification capacity means India can import larger volumes of LNG from different countries, improving energy security and reducing the risk of supply disruptions. It also gives industries access to a more reliable fuel supply.

The IGU report notes that global LNG trade reached a record 436.98 million tonnes in 2025, with Asia remaining the largest market for LNG.

India has also been working towards increasing the share of natural gas in its energy mix from around 6% to 15%. The government sees natural gas as a fuel that can help reduce dependence on coal while supporting sectors where cleaner alternatives are still developing.

A transition fuel with challenges

Although natural gas burns cleaner than coal, it is still a fossil fuel. Many experts describe it as a transition fuel because it can help lower emissions in the short term while renewable energy continues to expand.

However, natural gas also has environmental concerns. Methane, the main component of natural gas, is a powerful greenhouse gas, and leaks during production and transport can reduce its climate benefits.

India is therefore following a dual approach: expanding gas infrastructure to meet current energy needs while continuing to invest in solar, wind, green hydrogen and battery storage to achieve its long-term climate goals.

The IGU report shows that India’s latest investments are aimed at balancing energy security, economic growth and the transition to cleaner energy, even as the country continues to expand its renewable energy capacity.

Data center energy use could become cheaper and more efficient if AI facilities shift electricity consumption to off-peak hours, according to a new MIT study that highlights both economic and environmental trade-offs.

As artificial intelligence fuels a rapid expansion of data centres around the world, concerns are growing over how much electricity these facilities will consume—and whether power grids can keep up.

A new study by researchers at the Massachusetts Institute of Technology (MIT) suggests there may be a way to ease the pressure. Rather than consuming electricity around the clock at fixed rates, data centres could shift a significant portion of their energy use to off-peak hours, lowering electricity costs while making better use of existing grid capacity.

The findings, published in the journal iScience, indicate that if data centres adopt more flexible electricity consumption patterns, average power system costs could fall by as much as 5 per cent in Texas, 4 per cent in the Mid-Atlantic region and 2 per cent across western U.S. states.

Data Center Energy Use: Flexible Data Centers Could Reduce Energy Costs

The researchers modelled how expanding data centres would affect electricity grids in three regions that are expected to host about 82 per cent of U.S. data centres by 2030: Texas, the Mid-Atlantic and the Western Interconnect, which covers 11 western states.

Their simulations found that shifting at least one-fifth of a data centre’s electricity use away from peak-demand periods could reduce overall system costs. In some cases, as much as half of a facility’s energy demand would need to be moved to quieter periods of the day.

“The key with data centers is: How can we add them to the network without adding a lot to our peak usage?” said Christopher Knittel, economist at the MIT Sloan School of Management and co-author of the study, in a media statement.

“One way for data centers to do that — to add to average usage but not the peak usage — is if they provide some grid flexibility during those high-cost periods. And that’s what we’ve been interested in understanding.”

The researchers note that most data centres already have some operational flexibility because they typically run below full capacity. Instead of carrying out energy-intensive computing tasks during periods of peak electricity demand, many could shift those operations to midday, when solar power generation is often highest and overall demand is lower.

AI Growth Is Putting Pressure on Power Grids

The rapid expansion of AI has dramatically increased demand for computing infrastructure, raising questions about whether electricity grids can support hundreds of new data centres without driving up costs or emissions.

The study suggests that adding more data centres does not automatically translate into higher electricity prices. Because much of the cost of running a power grid comes from fixed infrastructure such as transmission lines, increasing electricity use can spread those costs across a larger customer base—provided peak demand does not rise at the same pace.

“It’s really just math,” Knittel said.

“There are two dimensions that data centers have to make decisions about. One is how much of their load in any one time period is flexible. And two, how many hours, plus or minus, can they move that computation?”

Flexible Data Centers May Have Different Climate Impacts

The environmental picture is more complex.

The researchers found that the projected growth in data centres by 2030 could significantly increase carbon dioxide emissions if electricity demand is met through fossil fuels. Compared with a scenario without new data centres, emissions could rise by 58 per cent in Texas, 20 per cent in the Mid-Atlantic region and 24 per cent in the western United States.

However, the impact varies depending on how regional electricity systems generate power.

In Texas, where wind energy accounts for a large share of electricity generation, shifting data-centre operations to times when renewable energy is abundant could reduce carbon emissions by as much as 40 per cent.

In contrast, the Mid-Atlantic region presents a different picture. There, flexible electricity use could unintentionally keep coal-fired power plants operating for longer periods.

“When data centers provide some flexibility in that latter scenario, the data centers actually move hours to when sun and wind energy production is slowing, and that allows a coal plant to stay on,” Knittel observed. “So it doesn’t necessarily attract more renewable investment. It attracts more coal investment.”

Policy Could Shape the Future of AI Infrastructure

The researchers argue that flexibility alone is unlikely to become common unless governments and grid operators create incentives for companies.

“That’s why we have policy,” Knittel said.

One option would be to allow data centres that agree to flexible electricity use to connect to the grid sooner.

“One big concern about these data centers now is how long it takes for them to connect to the grid,” Knittel said. “One way to provide flexibility now is what’s called ‘connect and manage,’ which is, connecting you faster to the grid if you agree to provide flexibility. Tech firms would take that deal. They would rather connect a year earlier, and throttle down computation a few hours a day, than to have to wait. We do this with power plants too.”

He added that industry-wide rules would help address competitive concerns.

“Tech companies say they won’t provide flexibility alone. But if everyone in the industry has to, it’s okay.”

Balancing AI Growth With Sustainable Energy

As governments and technology companies race to build the computing infrastructure needed for the AI era, the study suggests that when data centres consume electricity may prove to be as important as how much they consume.

The researchers conclude that smarter scheduling of electricity demand, combined with supportive public policy, could lower power system costs while reducing pressure on electricity grids. At the same time, the study highlights that the environmental benefits of flexible energy use will depend on how individual regions generate electricity, reinforcing the need for location-specific energy planning.

As Japan expands its role as a global gas trader, a new analysis raises questions about whether Asia is importing energy security—or future climate liabilities. Japan US LNG trade generated lifecycle emissions equal to about 17 coal plants in a year, raising concerns about Asia’s growing dependence on imported gas.

The liquefied natural gas (LNG) cargoes that Japan resold across Asia over the past five years generated greenhouse gas emissions equivalent to running about 17 coal-fired power plants for a year, according to a new analysis by Zero Carbon Analytics.

The finding comes at a time when several Asian economies are turning to LNG as a bridge fuel in their energy transition strategies, while governments simultaneously pledge to cut emissions and expand renewable energy.

According to the analysis, Japan resold 16.5 billion kilograms of US-produced LNG to nine Asian countries between 2020 and 2025. Across the fuel’s lifecycle—from extraction and liquefaction in the United States to shipping, regasification and combustion in Asia—those sales generated an estimated 63.5 billion kilograms of carbon dioxide emissions.

The report highlights a little-discussed aspect of Asia’s gas trade: Japan is increasingly acting as a middleman in the global LNG market.

Japan’s US LNG Trade–Japan Now Resells More US LNG Than It Uses

Japan remains one of the world’s largest LNG importers, but its domestic demand for gas has been declining.

The analysis found that between 2021 and 2025, Japan sold 77 percent more US LNG to other countries than it imported for its own domestic consumption.

In 2024, Japan ranked as the world’s second-largest LNG trader. While Europe remained the largest destination for Japanese LNG resales, nearly one-third of those transactions were directed to Asian markets, including South Korea, China, India, Taiwan, Thailand, Singapore, Bangladesh, Pakistan and Malaysia.

Three of Japan’s top ten LNG resale destinations were Asian economies: South Korea, China and India.

The numbers reflect a broader shift in regional energy markets. Countries seeking alternatives to coal have increasingly turned to LNG, often presenting gas as a cleaner transition fuel. Yet critics argue that this framing overlooks emissions generated throughout the fuel supply chain.

The Methane Problem

Natural gas is composed primarily of methane, a greenhouse gas that has far greater warming potential than carbon dioxide in the short term.

According to the International Energy Agency’s 2026 Global Methane Tracker, methane emissions from fossil fuel operations remain near record levels globally.

The Zero Carbon Analytics analysis estimates that roughly 30 percent of total LNG lifecycle emissions arise from methane released during extraction, processing and transportation.

Methane can trap around 80 times more heat than carbon dioxide during the first two decades after it enters the atmosphere, making leakage a critical concern for climate scientists.

The report’s emissions calculations include every stage of the LNG supply chain rather than focusing solely on combustion emissions at power plants.

Energy Security or Fossil Fuel Lock-In?

The findings arrive amid renewed concerns over energy security following instability in the Middle East and uncertainty surrounding global gas supplies.

Several Asian economies, including Thailand, Vietnam and the Philippines, have expanded LNG imports in recent years to diversify their energy systems. However, the same dependence has exposed them to volatile international fuel prices.

Yu Sun Chin, Asia Regional Researcher at Zero Carbon Analytics, said the growing trade has implications beyond emissions.

“Japan’s growing role as an LNG trader has significant implications for Asia, which is absorbing close to a third of Japan’s excess supplies. Our calculations of the full lifecycle emissions of these LNG resales highlight the risk they pose to a region already vulnerable to extreme weather and other climate impacts. Rather than increasing reliance on gas as a ‘transition fuel’, transitioning to renewables offers Asia a clearer route to a clean and secure energy future.”

The concern is not merely about current emissions. Energy analysts warn that investments in LNG terminals, pipelines and related infrastructure could lock countries into fossil fuel consumption for decades.

Sam Reynolds, LNG and Gas Research Lead for Asia at the Institute for Energy Economics and Financial Analysis (IEEFA), noted that Japanese companies are increasingly looking abroad as domestic demand declines.

“As Japan’s own LNG demand continues to decline, Japanese companies are becoming increasingly active traders of the fuel to other countries. At the same time, public and private financiers in Japan are investing in downstream infrastructure to stimulate demand and secure long-term customers.”

He added that such investments could leave emerging economies dependent on “a volatile, expensive fuel source for decades” while delaying renewable energy deployment.

Asia’s Climate Challenge

Asia is simultaneously one of the world’s fastest-growing energy markets and one of the regions most vulnerable to climate impacts.

From deadly heatwaves in South Asia to flooding in China and stronger tropical cyclones across Southeast Asia, the region is already experiencing the consequences of rising temperatures.

Climate scientists estimate that global emissions must nearly halve within this decade to keep the Paris Agreement’s 1.5°C goal within reach.

Against that backdrop, environmental groups argue that expanding LNG infrastructure risks undermining climate commitments.

Shruti Shukla, Senior Advocate for International Energy at the Natural Resources Defense Council (NRDC), said the region faces a strategic choice.

“Japan has long positioned itself as a regional energy and economic leader in Asia. That leadership should help accelerate a resilient clean energy transition across the region, not deepen dependence on another generation of imported fossil fuels.”

She warned that growing LNG imports expose countries to methane emissions, volatile fuel markets and costly infrastructure that could become obsolete as renewable technologies become cheaper.

The Economic Risks

The debate extends beyond climate concerns.

Researchers increasingly point to the possibility that LNG infrastructure built today may become stranded assets before the end of its expected lifespan.

Nawaphat Junkrajang, senior researcher at Climate Finance Network Thailand, cited research suggesting that nearly half of Thailand’s operating and proposed LNG terminal capacity could become economically unviable under the country’s climate commitments.

“Each additional resale cargo is not energy security. It is one more step into a lock-in the transition will eventually have to unwind,” he said.

Bangladesh faces similar concerns.

Dr Khondaker Golam Moazzem, Research Director at the Centre for Policy Dialogue, said new energy agreements and infrastructure investments could deepen dependence on imported LNG while narrowing opportunities for renewable energy investment.

A Growing Regional Debate

The analysis arrives as governments across Asia reassess their energy pathways.

Supporters of LNG argue that gas provides reliable electricity generation and can complement intermittent renewable sources. Critics counter that falling costs of solar, wind and battery storage are weakening the economic rationale for large-scale LNG expansion.

What is clear from the data is that Japan’s role in regional gas markets is evolving rapidly. The country is no longer simply a major LNG consumer; it has become a significant intermediary connecting US gas producers with Asian buyers.

As Asia balances energy security, affordability and climate goals, that role is likely to attract increasing scrutiny.

For policymakers, the question may no longer be whether LNG emits less carbon than coal at the point of combustion. Instead, it is whether a region racing to build a low-carbon future can afford to lock itself into another generation of fossil fuel infrastructure.