Plugged In: Exploring Energy with Constellation - Episode 4

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Growing Energy Demand for Data Centers

The rapid growth of data centers, particularly since the pandemic, has an associated increase in energy demand. The industry has shifted from small-scale data centers to much larger facilities, with some reaching hundreds of megawatts or even gigawatts. The rise of hybrid work models has further accelerated this trend. There are also the challenges of meeting energy needs with renewable power while accommodating the growing size and density of data center racks.

Energy Procurement and Sustainable Power Solutions for Data Centers

There's a growing urgency for energy procurement in data centers, driven by increasing demand and shorter timelines for power delivery. Developers are now engaging with utilities 24 to 36 months ahead of time to secure power, especially in emerging markets. Socia highlights the challenge of balancing speed to power with sustainability goals. The trend of "bridging power solutions," such as on-site generation with fuel cells or natural gas, is also explored, alongside the difficulty of aligning renewable energy standards with immediate power needs. There is rising interest in co-locating with nuclear or wind power, but the benefits of grid connections are greater despite challenges related to public sentiment.

Balancing Renewable Energy with Reliability in Data Centers

While customers are committed to clean energy targets, the availability of renewable sources like wind energy can be inconsistent, requiring a reliance on natural gas in many regions. Areas such as central and western Pennsylvania, Texas, and even parts of the southern U.S. are seeing increased attention due to the abundance of natural gas, making them more attractive for data center development. Socia brings up the importance of energy storage solutions to capture renewable energy when available and meet the demands of tenants, with the need for speed to market being a critical factor in the decision-making process.

Energy Efficiency and Sustainability in Data Centers

Data center customers are optimizing energy efficiency amid increasing demand, especially driven by AI technologies and more powerful GPUs. Key strategies include the adoption of liquid cooling, which is now considered essential due to higher rack densities, and the implementation of SCADA systems and DSIM software to monitor and improve energy efficiency in real time. They are also balancing sustainability with business needs, with many working toward carbon reduction targets while also ensuring reliable and timely energy procurement. While hybrid energy approaches such as using natural gas as a bridging power source are common in regions like Texas, the cost and availability of cleaner energy sources like fuel cells may vary by location.

Siting and Building Data Centers

Siting, sourcing, and building data centers involves multiple teams and a strategic approach tailored to the specific needs of clients. The initial step is understanding the client’s requirements, such as latency needs or cloud availability zone expansion, which helps determine viable markets. Site selection teams, often aided by brokers familiar with regional power markets, assess factors like land availability, power infrastructure, and potential for brownfield development. Energy procurement and technical considerations, such as power line capacity and geographic constraints, are also key.

The Future of Sustainable Energy in Data Centers

Socia discusses emerging technologies and the future of sustainable energy in the data center industry. Small modular reactors (SMRs) are a promising but challenging solution due to regulatory hurdles and public opposition. Hydrogen-based power generation is also seen as a potential solution, though its high cost remains a barrier for widespread adoption. On the operational side, liquid cooling is becoming increasingly important as rack densities rise, particularly driven by AI workloads. Socia emphasizes the need to strengthen the electrical grid and improve transparency in utility practices to meet the growing power demands of data centers. Collaboration between data center providers and utilities is crucial for ensuring reliable, sustainable power while supporting continued industry growth.

Connect with Ed Socia

•  On LinkedIn

Hailing from Syracuse, New York, Ed has a background in sustainability, focusing on renewable power generation and the growth of digital infrastructure. Before joining datacenterHawk as its Director for North America, Ed was the Director of Research for North America at CBRE. He currently resides in Denver, Colorado, with his fiancée Brittany and their pug, Sherman.

Connect with Melissa Zimmerman

•    On LinkedIn

Melissa Zimmerman is a seasoned professional with over 17 years in the energy industry, currently serving as the Director of Commercial Strategy at Constellation. In this role, she supports the growth of Constellation's commercial business, which markets electricity, natural gas, and other energy-related products and services to various customer segments, including wholesale, commercial, industrial, and residential clients. Prior to her current position, Melissa held several key roles within the company, including Chief of Staff, Manager of the Mid-Atlantic Sales Support team, and Account Manager for commercial real estate customers in the DC and MD area. She began her career at Constellation as a pricing analyst, where she was responsible for pricing and validating energy contracts for retail customers. Melissa holds a bachelor's degree in Mathematics and Economics from Towson University and a Master of Science degree in Applied and Computational Mathematics from Johns Hopkins University.

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