When "aircraft engines" become the target for "data center power supply"

In the arms race for AI computing power, every engine of the economy is being swept into the battle—including jet engines.

As Silicon Valley giants desperately search for stable power sources, an unexpected solution is emerging from the aviation industry: retrofitting retired Boeing aircraft engines into ground-based gas turbines to directly power data centers.

With the exponential growth in power demand from AI data centers, the lag in traditional grid expansion has become a common enemy for the industry. Against this backdrop, companies like FTAI Aviation and ProEnergy are accelerating the “downscaling” of aviation power assets into the electricity market. This cross-industry experiment is not only changing the fate of decommissioned aircraft, but also reshaping the global landscape of distributed energy supply.

The Premium on Speed: Spot Market VS Long Cycle

In the field of power equipment, time is money. Currently, the global gas turbine market is dominated by the “big three”—GE Vernova, Siemens Energy, and Mitsubishi Heavy Industries (MHI)—which together hold about 80% of the market share. However, due to soaring demand, order lead times for large heavy-duty turbines from these giants now stretch over several years.

This supply-demand mismatch has created an opportunity for aviation asset management companies like FTAI Aviation. FTAI President David Moreno points out that retrofitting an aircraft engine into a power generation turbine takes only 30 to 45 days. Although initial design and adaptation take about 18 months, once in the modification process, its delivery efficiency far surpasses that of traditional energy giants.

This “spot advantage” has triggered a strong resonance in the capital markets. Since announcing its entry into the power business, FTAI’s stock price has risen about 42%. According to Jefferies, this business could contribute $750 million in EBITDA to FTAI annually, equivalent to 52% of analysts’ previous full-year estimates for the company.

Downscaling Strike: From “High-Pressure Takeoff and Landing” to “Stable Power Generation”

Technically, converting aircraft engines for land-based power generation (Aeroderivatives) is highly feasible.

Aviation turbine expert Mark Axford points out that the core of the conversion involves two key changes: first, replacing the fuel nozzles so the engine can burn natural gas instead of jet fuel; and second, swapping the large front flight fan for a smaller fan more suitable for power generation.

From an asset life perspective, this is more like a precise “residual value re-creation.” Narrow-body aircraft engines (like the CFM56 used in Boeing 737s) endure frequent high-pressure stresses from takeoffs and landings during flight, but once converted for ground-based power, their wear and tear drop significantly. FTAI can extend the useful life of aviation parts with only a few years of remaining service in flight to several years in power generation.

Currently, this field has already attracted various players: ProEnergy is retrofitting engines from Boeing 747s; the startup Boom Supersonic also plans to deliver its modified gas turbines to AI data center service provider Crusoe in 2027.

Efficiency Game and Supply Chain Butterfly Effect

Facing these new entrants, GE Vernova CEO Scott Strazik stated in a recent earnings call that he does not view these smaller units as direct competitors. His main argument centers on “efficiency”: over a 20-year operational cycle, the fuel efficiency advantage of heavy-duty turbines remains the financial core for data center operators.

However, market research firm Thunder Said Energy points out that while heavy-duty turbines are more efficient, they are expensive and have extremely long wait times. To compensate for the efficiency gap, both FTAI and Boom Supersonic offer their products in a “Combined Cycle” mode, adding a steam turbine to capture waste heat, thus approaching the efficiency of heavy-duty units.

The broader impact lies in production capacity. Jefferies analyst Sheila Kahyaoglu notes that around 1,600 commercial engines are retired globally each year. If one-third are converted for power generation, it would add 13GW of capacity—about a quarter of the world’s annual capacity growth. The U.S. Energy Information Administration (EIA) even estimates that the potential conversion capacity of retired military engines could reach 40GW.

But this capacity shift is not without risks. If a large number of aviation components are diverted to the power sector, it could further exacerbate the already extremely tight aviation maintenance market, triggering a chain reaction in global airlines’ operating costs.