Access to reliable power has become an urgent priority for data centers as a result of the projected explosion in artificial intelligence (AI) adoption over the next few years. It’s a big challenge for hyperscalers, colocation facilities, and large corporate data centers because demand is likely to outpace supply.
Despite predictions that AI was coming, data centers really weren’t prepared for the unprecedented demand that Generative AI has created. Currently, some 92% of companies are planning to invest in AI, according to research by McKinsey. To run AI workloads, data centers need lots of power.
Data center operators need to secure reliable supplies so they can forge ahead with expansion plans to support AI. Accenture predicts that power consumption by U.S. data centers will grow from the current 6% to more than 7% by 2028. And by 2033, that share will grow to at least 16% – and perhaps exceed 20%.
Constrained supply and bottlenecks
Currently, most U.S. markets are struggling to secure enough energy to meet data center demand. Geographies such as Northern Virginia, Silicon Valley, and Atlanta, which have a high concentration of data centers, are under great pressure to secure supply. Data centers in those markets have to wait five to seven years for grid connections.
If constraints persist, they may create infrastructure bottlenecks that could hinder the adoption of AI technologies. This would mean that the expected benefits of AI, including increased operational efficiencies, enhanced energy management processes, and improved customer service, would be delayed. Limited power supply also raises concerns about sustainability strategies because, without AI-driven solutions, it will be harder for organizations to decarbonize.
Solutions to supply constraints
Data center and colocation operators and hyperscalers need solutions to the challenges created by supply constraints – and they need them now. Currently, operators are scrambling to secure reliable power, which in some cases has led to surprising developments.
Data Center Alley in Northern Virginia may get power from coal-fired plants in West Virginia that were scheduled to be decommissioned in the near future. In Abilene, Texas, developers of the 360-megawatt Stargate data center plan to build a natural gas plant at the site. In other cases, nuclear power is being considered.
Regardless, the move toward sustainability will go forward. Innovations involving fuel cells and battery energy storage systems (BESS) can help provide power for data centers, storing energy for use during peak hours to reduce reliance on the grid. Renewables such as solar, wind and hydroelectric are part of the equation, helping to decrease the use of fossil fuels.
By working with partners such as Schneider Electric, data center operators can ensure renewable energy remains a key component of their power supply strategies. Schneider has the expertise and technologies to help data centers source power at scale to ensure you have the energy you need.
Our expert consulting teams provide you with insights into market dynamics, such as upcoming regulations and grid tension areas. And our procurement teams can leverage long-lasting relationships with utilities to help you secure reliable power. We’ve worked with data center operators around the world on power procurement agreements (PPAs), and we can do the same for you.
Learn more about our AI-ready data center solutions that can help you address power challenges and build a more resilient, scalable infrastructure.
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