NEW YORK: The U.S. power system isn't expanding fast enough to keep up with rapidly growing power demands driven by technologies such as generative AI, leading data center operators to sometimes bypass power companies, executives say. said this at an energy conference this week.
Layered regulations, citation and permitting processes, and frequent legal battles by environmental and community groups delay the connection of new power projects to the grid and threaten the interests of traditional power companies, including regulated utilities. It becomes.
“Regulation and permitting in the U.S. is terrible,” Brad Stansbury, who heads the power and utilities industry financial management practice at services firm KPMG, said at the AI: Powering the New Energy Era summit in Washington on Wednesday. ” he said.
The delays have led data center companies to bypass utilities and contract directly with power producers or build their own supply.
Data center developer Aligned, the largest company of its kind with 2.5 gigawatts of capacity, is rushing to pursue power after spending years buying land for its operations.
Phil Lawson-Shanks, chief innovation officer at Aligned, said: “We always assumed there would be electricity, but clearly that assumption was horribly inaccurate. So now we're trying to figure out where the electricity is going. I'm trying to find out if there is.”
Among its power considerations, Alignment is considering using small modular nuclear reactors, a type of nuclear energy system currently under development in the U.S., to power some of its projects. Lawson said the company is working with power companies on projects in such cases. Shanks said. “If you can't do that, you need to put them behind the meter,” he added.
Utilities also lamented their constraints in meeting the power needs of companies supporting chatbots and other artificial intelligence, such as ChatGPT, which requires about 10 times more energy than a Google search.
“It's hard to build something quickly,” said Michael Kaiser of the National Renewable Energy Cooperative Association, which represents about two dozen generation, transmission and distribution cooperatives. “So I think it's no surprise that data centers and tech companies are now purchasing their own power.”
Regulated utilities cite a slow regulatory process for expanding their systems, especially when it comes to demand for renewable energy such as solar and wind, while also warning that a surge in demand from big tech will help them grow. Are expected.
“If you drive that bus, that's great for us,” said Brian Byrd, head of electric and natural gas company Northwestern Energy, referring to technology companies' dominance in power generation. In fact, it will be easier.”
