Utilities, developers and companies building artificial intelligence data centres are searching worldwide for second-hand gas turbines. They are also bringing idle machines back into service and converting retired jet engines into power generators. The push comes as waiting times for new equipment extend into the next decade.
Demand for power-hungry data centres is still climbing, even as scepticism about the risks of AI grows and related shares have recently sold off. That surge has created a serious bottleneck for critical power infrastructure, including turbines.
Turbine shortages push buyers toward used equipment
Aurora Tenorio, a senior analyst at the energy consultancy Wood Mackenzie, said talks about US turbine deliveries are centred on a specific period. “Delivery conversations (are) firmly focused on the 2030 to 2031 window,” she said.
Rather than wait for order backlogs to clear, some companies are looking at second-hand, refurbished and jet-engine-based turbines. This comes from more than a dozen brokers, service firms and suppliers.
Ana Amicarella, chief executive of EthosEnergy, an equipment services provider, described the resale market as extremely active. “That secondary market is very, very hot right now,” she said. She added that the prices buyers are demanding have also risen.
Wood Mackenzie says global orders for gas turbines now exceed 100 gigawatts (GW). That is well above the estimated global production capacity of between 60 GW and 70 GW.
Analysts at the investment bank Jefferies estimate that US data centres alone account for nearly 17 GW of demand this year. They say that figure could more than triple by 2028.
Jefferies’ analysts also expect global gas turbine manufacturing capacity to reach around 87 GW in 2028. Even so, that would fall well short of the 129 GW of expected turbine demand. Siemens Energy, GE Vernova and Mitsubishi Heavy Industries, which dominate the market, say the AI boom has pushed orders beyond their production capacity. Tenorio said that in the United States, a gas turbine now takes six years to deliver on average.
Crusoe deal shows how jet engines enter the market
AI infrastructure firm Crusoe ordered 13 aeroderivative gas turbines from the US company ProEnergy in April. These units are based on jet engines made by GE Aerospace. Crusoe described the purchase as a strategic step to grow quickly. The turbines have a combined capacity of 650 megawatts and will power Crusoe’s AI data centre projects in the United States.
ProEnergy and Crusoe did not respond to requests for further information.
Only a few years ago, gas turbines were bought almost exclusively by traditional utilities. Data centres and their operators have since become major customers.
Noor Qureshi, an associate at Enverus Intelligence Research, said the used-equipment market can only partly ease the squeeze. “The market is already constrained, with limited excess supply, so it is unlikely to offset a meaningful share of the delays,” she said. She also noted that turbines are only one obstacle, as air permits, grid access and other factors are also causing delays.
No reliable estimates exist for how much the secondary market contributes to global turbine supply, which is worth about $25 billion a year. The market’s emergence, however, shows how deeply the data centre boom has affected the wider industry.
Prices, risks and cheaper options for smaller buyers
Zach Machuca, managing partner at Origin Partners, which buys power equipment for data centre developers, said well-maintained used units can sell for about $1.5 million to $1.7 million per megawatt. Refurbished units go for about $1.3 million. Aurora Energy Research puts new turbines at about $2 million to $2.5 million per megawatt.
The discount can be bigger for smaller and cheaper units. Dan Poole, general manager at ReflowX, which connects buyers with turbine owners, said two 14.5-megawatt turbines made by Solar Turbines, a Caterpillar unit, recently sold for $12.5 million. That works out to around $430,000 per megawatt. He said new machines of that size would cost about $35 million and take five years to deliver. He did not disclose the buyer.
When larger turbines are hard to find, developers turn to small units. Scott Schreeg, director of sales at US equipment supplier SVI Bremco, said they sometimes deploy more than 100 at a single site and mix models and brands.
Used equipment carries its own risks. Tenorio said overhauled turbines can have unclear maintenance histories, limited remaining life and weak long-term servicing. Converted jet engines raise questions about whether they can handle continuous work as power generators.
Darayus Pardivala, who leads the US aftermarket business of Sulzer, said requests are arriving frequently. “Every few weeks we get a request to say, ‘Can you find a used gas turbine to put into a data centre?’” he said. He would not disclose the clients or the locations of the centres.
The Tennessee Valley Authority, a federally owned US utility, said prices for all equipment, whether new, used or refurbished, have “increased significantly” over the past two years. Jim Matheson, chief executive of the National Rural Electric Cooperative Association, said its members face unprecedented lead times and surging prices. “Co-ops that need new capacity are turning to every viable option,” he said, including buying refurbished turbines.
Finland’s Wartsila offers another route. Anders Lindberg, president of the group’s energy business, said it has booked around 3 GW of orders since spring last year from US data centres. Those orders are for power units that run on gas engines instead of turbines. “What’s driving the market? Lead times, lead times, lead times,” he said.
