Data center surge may not need gas after all, experts say

U.S. energy experts are warning that the rapid expansion of data centers may strain the power grid and push electricity costs higher, but they say large on site batteries could offer a cheaper and cleaner alternative to natural gas units now being added near many facilities.

For years, national electricity demand has remained stable, yet analysts expect usage to climb by roughly a quarter before 2030 due to artificial intelligence and cloud computing.

Utilities and tech firms have responded by planning or installing new gas turbines to guarantee around the clock power, a strategy that critics say locks in higher emissions and forces costly grid upgrades.

Specialists argue that data centers could instead ease demand during extreme heat or cold by tapping batteries or briefly curbing operations during the handful of hours each year when the grid is most stressed.

Former Energy Department official Jigar Shah says batteries can help stabilize the system because operators can charge them when prices fall and sell power back when demand spikes.

He adds that batteries can generate revenue through capacity payments in markets like the Mid Atlantic region, offering a potential payback timeline of about fifteen years.

By contrast, Shah says behind the meter gas units offer no similar compensation and often sit idle except during emergencies.

Energy economists note that batteries can also support renewable energy by storing surplus wind and solar output, a key step in cutting emissions as electricity use grows.

Some analysts say it may even be cheaper for tech companies to fund weatherization in nearby homes to reduce peak heating and cooling loads instead of buying new generators.

Community backlash against fossil fueled data center projects has already prompted major tech firms to withdraw proposals in several states, a trend that experts say may intensify unless companies adopt more grid friendly strategies.

Policy researchers warn that governors and local officials will need clearer guidance on grid planning as demand accelerates and incentives for clean technologies shift under federal budget changes.

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— TBC News Official (@tbcnewsph) September 5, 2025