{"id":135318,"date":"2026-03-25T21:22:50","date_gmt":"2026-03-26T00:22:50","guid":{"rendered":"https:\/\/tech.einnews.com\/article\/901755246"},"modified":"2026-03-25T21:22:50","modified_gmt":"2026-03-26T00:22:50","slug":"how-big-tech-and-big-power-are-locking-arms-to-save-the-grid","status":"publish","type":"post","link":"https:\/\/new7.shop\/zerocostfreehost\/index.php\/2026\/03\/25\/how-big-tech-and-big-power-are-locking-arms-to-save-the-grid\/","title":{"rendered":"How Big Tech and Big Power are locking arms to save the grid"},"content":{"rendered":"
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HOUSTON \u2014 Technology companies have had one message for America\u2019s energy industry: We need more electricity, and we need it now.<\/p>\n

That insatiable thirst, however, is now being offered with a sweetener: Big Tech is also ready to fix the grid.<\/p>\n

Companies like Google, Microsoft, NVIDIA and others have made appearances at this year\u2019s CERAWeek by S&P Global conference to tout the potential benefits of their data centers for the power industry. The vast power needs of the data center industry is driving up electricity demand and spurring new infrastructure development, creating new revenue streams for power producers and electric utilities.<\/p>\n

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But as the artificial intelligence data center boom accelerates, there\u2019s political pressure to keep utility bills from spiraling upward and a greater appreciation inside the tech industry for the challenges utilities and power grids face in managing unprecedented increases in electricity demand.<\/p>\n

Tech companies are talking about building in more flexibility to data center demand. They want to use AI tools to help utilities deal with day-to-day operations, offer high-tech ways to speed up grid connections and develop semiconductors that require less power for next-generation AI models.<\/p>\n

\u201cYou want those good citizen data centers that will better utilize the existing grid, keep the grid stable and lower rates for everyone,\u201d said Emerald AI CEO Varun Sivaram in an interview.<\/p>\n

Rising electricity rates \u2014 a symptom of the aging grid and electrification across the economy, not solely data centers \u2014 has spurred more communities to push back on new developments. It\u2019s a dynamic that brought major tech companies to the White House this month to sign the \u201cRatepayer Protection Pledge,\u201d a nonbinding commitment by the AI industry to cover the full cost of the power and grid infrastructure for their data centers.<\/p>\n

Jarrod Agen, executive director of the White House\u2019s National Energy Dominance Council, said President Donald Trump wants the tech giants that need the power to develop AI to build their own power generation. Agen positioned the approach as good for consumers.<\/p>\n

\u201cYou don\u2019t want the specter of \u2018It\u2019s going to raise electricity prices\u2019 to cut that off and not allow them to come into the community and bring in the good things that they can do,\u201d Agen said at the POLITICO Pub at CERAWeek.<\/p>\n

Microsoft President Brad Smith acknowledged in a speech at CERAWeek that the cost of electricity is \u201cissue No. 1 today\u201d and that the company is prioritizing community engagement and pledging to pay above market for electricity in order to cover grid costs.<\/p>\n

\u201cIf we\u2019re going to pursue a sustainable strategy, you can\u2019t go in and say, \u2018I\u2019m going to win in this city or this county tomorrow,\u2019 without a regard for what they need,\u201d Smith said.<\/p>\n

\u201cThe tech companies, they want to talk a lot about what AI is doing for efficiency, permitting and planning,\u201d said Rep. Kathy Castor (D-Fla.). \u201cThey want to explain: \u2018Look at what AI can do for interconnection queues and getting products on the grid.\u2019\u201d<\/p>\n

Embracing flexibility<\/h4>\n

If there\u2019s any conventional wisdom that\u2019s changed in the past year, it might be that \u201cbehind-the-meter\u201d electricity generation \u2014 operating off the public grid to serve a single data center \u2014 is a viable solution to meeting the power needs of AI companies.<\/p>\n

From Amazon to Dominion Energy, executives said it\u2019s increasingly expensive and risky to plan a data center around off-grid power.<\/p>\n

\u201cThat\u2019s a bad outcome for the industry because it\u2019s basically saying that players are taking new generation into their own hands because the system is not keeping up,\u201d said Kerry Person, head of data center planning for Amazon.<\/p>\n

Ed Baine, president of Dominion Energy Virginia, urged the industry to invest in the grid, not flee it.<\/p>\n

Aamir Paul of Schneider Electric said the company\u2019s tracking 40 gigawatts of behind-the-meter electric turbines that could be used to meet the power needs of data centers.<\/p>\n

\u201cIt\u2019s a temporary solution at best,\u201d Paul said. \u201cBe part of the solution for the grid, then I think it\u2019s interesting.\u201d<\/p>\n

Matt O\u2019Connor, chief investment officer of international energy investment for the Carlyle Group, said finding ways to cut electricity consumption when demand is high is the key.<\/p>\n

\u201cShaving the peak. If we can shave that, it saves power plants investments \u2014 and it saves the grid,\u201d O\u2019Connor said.<\/p>\n

Tech developers have traditionally asked for power that can run almost all the time, but are increasingly coming around to a more flexible arrangement. When extreme weather or surges in demand stress the grid, data centers could agree to reduce demand, shift intensive work to another site or revert to backup power.<\/p>\n

Through its DCFlex initiative, the Electric Power Research Institute has piloted demand response and flexibility pilots. This week, the research organization announced Flex MOSAIC, a classification system for large loads developed with more than 65 utilities, system operators, regulators and tech companies. The framework creates a shared framework for data center flexibility, which EPRI says can make it easier to bring those loads to the grid and improve utility planning.<\/p>\n

Google last week announced<\/a> that it was integrating 1 GW of demand response into utility contracts in the South and Midwest. Chipmaker NVIDIA and Emerald AI on Monday announced partnerships with six power providers \u2014 including Constellation, NextEra Energy and Vistra \u2014 to build data centers that can operate as flexible assets and connect to the grid quicker.<\/p>\n

Judy Chang, a commissioner on the Federal Energy Regulatory Commission, said that AI can be a tool to enhance grid management \u2014 but needs the right nudge from regulators<\/p>\n

\u201cThe price signals clearly are not enough to drive investments on demand side response,\u201d Chang said on a panel Monday. \u201cI think this a moment to talk about the use of AI \u2026 to make sure that these applications go all the way down to not just the large users, but the smaller users as well.\u201d<\/p>\n

What\u2019s at stake<\/h4>\n

The tech industry\u2019s zeal to build as much and as quickly as possible can be in conflict with the utility industry\u2019s traditionally slower timeline \u2014 to say nothing of a choked supply chain that makes new fossil fuel infrastructure a challenge. But the pace of growth is not slowing down.<\/p>\n

According to data from Brian Partridge, executive director of analysis at 451 Research, a part of S&P Global Energy, there are 62 GW of IT power on the grid, including cryptocurrency miners and data centers paired with power plants. By 2030, Partridge forecasts there will be 151.7 GW \u2014 an increase of nearly 2.5 times.<\/p>\n

EPRI forecasts<\/a> that data centers could consume between 9 and 17 percent of the country\u2019s electricity by 2030.<\/p>\n

Raiford Smith, global director of power and energy at Google Cloud, said the collision of the two industries presents \u201can incredible opportunity.\u201d<\/p>\n

\u201cYou\u2019ve got an engine that\u2019s revving really fast, and that would be the high-tech industry, and then you\u2019ve got this traditional utility and energy infrastructure that\u2019s used to operating on really long time horizons and at a pace that isn\u2019t traditionally where the tech companies have been,\u201d Smith said. \u201cAnd that middle ground of trying to couple those two together, I think, is the challenge and the opportunity that you see in front of us.\u201d<\/p>\n

Increasingly, tech companies are also saying they\u2019ll invest in tools that can improve the grid, or even speed up emerging clean energy technologies like geothermal energy and small-scale nuclear energy.<\/p>\n

In an announcement pegged to the conference, Microsoft and NVIDIA said they are working together on an AI-based tool<\/a> that can streamline permitting, design and operations for new nuclear projects to help bring them to the grid.<\/p>\n

Google President Ruth Porat appeared alongside NextEra Energy CEO John Ketchum to tout how the companies would partner to restore nuclear power to the grid. Other power companies are embracing AI to smooth their operations<\/a>.<\/p>\n

Mark Brownstein, senior vice president of energy at the Environmental Defense Fund, said there\u2019s pressure on Big Tech companies and data center developers to prove their value to local communities. A build-out of gas power, Brownstein said, means that many communities are seeing \u201chigher electricity bills, more air pollution and worries about water supply.\u201d<\/p>\n

\u201cThat is a recipe for increased public resistance to the development and deployment of this technology that could actually work to set this whole opportunity back,\u201d Brownstein said.<\/p>\n

THIS WEEK ONLY: Follow POLITICO Pub CERAWeek like an insider with a free seven-day trial of POLITICO Pro\u2019s Morning Energy newsletter, delivering the deals, policy moves and conversations shaping the week. Plus access to E&E News, POLITICO\u2019s essential suite of energy and environment coverage. <\/i>Sign up now<\/i><\/a>.<\/i><\/p>\n

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