The paper, Data center dispatchable capacity: a major opportunity for Europe's energy transition , provides new analysis on how data center microgrids can reduce grid infrastructure spending, emissions and wasted energy, while providing a balanced path for the energy transition.
The analysis finds that powering the data centers across Europe by optimized microgrids could create a significant bank of dispatchable power, supporting the entire continent's energy transition.
The rapid growth of AI is driving increased demand for data centers across Europe, which is expected to increase by 250% by 2030, from 10GW to 35GW. With the continent's grid facing constraints from high energy prices and bloated grid connection queues, data center operators are increasingly turning to off-grid solutions to power these energy-intensive assets.
Anders Lindberg, President of Wärtsilä Energy and Executive Vice President of Wärtsilä, says, "The growth of AI over recent years has been extraordinary, and as it continues to transform the way we live and work, it drives a need for more energy. This is causing significant challenges for grid operators across Europe, who are struggling with rising costs and up to a 10-year waiting time for a grid connection.
“By investing in microgrids, data centers can sidestep energy constraints, and with the right technology mix of renewables, grid balancing engines and energy storage, can ensure their emissions profiles and costs do not outweigh the huge benefits that AI brings.”
AVK CEO Ben Pritchard says, "The answer to the challenges we face in combating climate change is as much to do with changing behaviors as developing new technologies. And the key to behavioral change is the recognition that there are different ways of doing things. The solutions outlined in this paper are not impractical, they are based on real-world cases and calculations.
"All that's needed to make them more widespread is for investors, operators, equipment suppliers, planners, policy makers to recognize the widespread benefits that sharing dispatchable data center capacity with the grid can bring and pass that knowledge on.”
In addition to benefits created by microgrids, engine power plants bring cost efficiencies to data center power generation. Modeling an 80MW data center, a combination of engine power plants, renewables, and energy storage provides the lowest levelized cost of electricity – at 108 EUR/MWh – in comparison to three other real-world scenarios.
It also offers a low emissions scenario in comparison to the other modeled scenarios, and particularly in comparison to gas turbines. The emissions of engine power plants can also decrease as sustainable fuels become commercially available.
"Through investing in flexibility, microgrids can have the lowest possible cost, while cutting emissions dramatically compared to other pathways including turbines. This flexibility can have a significant, positive impact on the continent's digital and energy transition," Lindberg states.
On current trajectories, 40% of existing AI data centers will be operationally constrained by power availability by 2027. Microgrids can take this new strain off the grid in the short term and when grid connection is achieved, excess energy generated can be sold. As well as furthering cost reductions for data center operators, this can provide vital flexibility to Europe's power challenges.
