Google, Meta and Nvidia join initiative to address data center power dilemma

Technology heavyweights Google Meta, and a dozen energy companies and developers are co-founding members of DCFlex, an initiative that plans to test technologies and designs that ease the strain data centers are putting on the U.S. electricity grid.

Power consumption by data centers, particularly those supporting cloud service and artificial intelligence, doubled between 2017 and 2021. By 2030, the sector could consume 5 percent to 10 percent of U.S. electricity, double today’s appetite, according to data from the Electric Power Research Institute, or EPRI.

DCFlex, which was launched by EPRI, plans to build five to 10 demonstration hubs starting in the first half of 2025 and running over the next two years. The locations have not yet been selected, according to an EPRI spokesperson. 

Among other things, the group will explore ways to streamline grid integration of data centers and transition common backup equipment — which often comes in the form of on-site diesel generators — into renewable assets on the grid.

“Flexible data center design and operation is a key strategy for accelerating AI development and realizing its benefits while minimizing costs, lowering carbon emissions and enhancing system reliability,” said EPRI President and CEO Arshad Mansoor, in the Oct. 29 launch announcement.

Other companies backing the project are: Compass Datacenters and QTS Data Centers; developers and utilities Constellation Energy, Duke Energy, NRG Energy, New York Power Authority, Pacific Gas & Electric, Portland General Electric, Southern Co. and Vistra; and grid operators Electricity Council of Texas (ERCOT) and PJM Interconnection. 

“Our energy system is built to handle the extreme demands of our hottest summer days and cold winter nights but is often underutilized,” said Joe Dominguez, president and CEO of Constellation Energy. “The real challenge isn’t a lack of energy for data centers but managing the peak demand hours. The ability of data centers to flex during these critical periods is crucial.”

More companies are expected to join DCFlex, the EPRI spokesperson said. The initiative plans to publish best practices and resources including a design reference guide for utilities, regulators, data center development and operators.

Creative planning already under way

One approach the group is likely to study is Google’s carbon-aware computing approach, which delays or moves data center workloads depending on whether carbon-free power is available to handle the tasks. Demand response helps reduce the energy intensity of data centers, said Savannah Goodman, data and software climate solutions lead, climate operations at Google, during a session Oct. 30 at VERGE.

“The good news is that the folks who are worrying about this are those who are leading the way on these practices,” Goodman said.

Another strategy data center operators and tech companies are using more often: selecting sites outside regions and markets already flooded with campuses. “Hyperscalers are going to places you might not have heard of before,” said another VERGE panelist, Aaron Bilyeu, chief development officer at Cloverleaf Infrastructure.

Pennsylvania, for example, has become the focus of at least two intriguing nuclear deals. Microsoft has signed a 20-year-long power purchase agreement to reopen a reactor at Three Mile Island. Elsewhere in the state, Amazon has negotiated a deal with Talon Energy to directly power a data center campus, although the Federal Energy Regulatory Commission has rejected the interconnection deal needed to happen.

Google, meanwhile, has committed billions of dollars to sites in Nebraska and Iowa. Meanwhile, Amazon Web Services is investing $11 billion in Indiana, the largest corporate capital infusion in the state’s history. These aren’t the only places the two companies are targeting, but they’re expanding the conversation about what’s possible.

Locations that are favorable include:

• Cooler climates, where the costs of keeping infrastructure from overheating are lower.
• Places easily accessible from existing roads.
• States seeking to change the power mix of power on their grids and eager for more renewable generation capacity. 

“Given that a lot of companies are trying to decarbonize at the same time, we need to diversify the loads across states,” said Raj Bazaj, vice president of sustainability solutions at Constellation Energy, the nation’s biggest owner of nuclear power plants. 

Constellation signed a 20-year-long power purchase agreement with Microsoft in September to bring a reactor back online at Pennsylvania’s Three Mile Island nuclear plant. “There’s bipartisan interest in removing the bottlenecks” to more deals such as these, and the DCFlex program will explore innovative ways to accelerate those conversations, Bazaj said.