New energy projects attract big data centers

The rapid growth of AI and data centers is accelerating investment in new energy projects, including nuclear, geothermal, battery storage, and other innovative technologies, to meet surging power demand.Rising Energy Demand from Data CentersData centers are becoming major electricity consumers, with U.S. centers already accounting for over 4% of national electricity use, projected to rise to 12% by 2028, largely driven by AI workloads . Globally, electricity demand from data centers is expected to double by 2030, with AI-focused centers potentially tripling their power use . This surge is equivalent to adding a top-10 power-consuming nation to the grid, highlighting the urgent need for reliable, low-carbon energy solutions .Investment in Innovative Energy TechnologiesThe data center boom is catalyzing investment in a diverse range of energy projects. Hyperscalers and governments are procuring energy from nuclear, geothermal, fuel cells, and battery storage systems to ensure stable, low-carbon power . Small modular reactors (SMRs) are gaining traction, with companies like Google, AWS, and Microsoft securing agreements to support new nuclear capacity . Advanced geothermal and long-duration energy storage are also being deployed to handle fluctuating AI workloads .Grid and Infrastructure ChallengesRapid data center expansion is straining existing power infrastructure. Grid congestion, long connection queues, and aging transmission systems are delaying new projects, particularly in high-density regions like northern Virginia and Dublin . Supply chain constraints for transformers, gas turbines, and critical minerals further complicate timely deployment . Onsite natural gas generation and battery storage are increasingly used to bridge gaps while grid upgrades are completed .Strategic Energy ProcurementData center operators are adopting an “all of the above” approach, combining renewables, nuclear, and fossil fuels to secure reliable power . Long-term power purchase agreements (PPAs) with nuclear plants, such as Microsoft's 20-year deal with Three Mile Island, exemplify the sector's commitment to low-carbon energy while managing supply risks . The tech sector also accounted for around 40% of corporate renewable PPAs in 2025, signaling its influence on the energy transition .ConclusionThe expansion of AI and data centers is not only driving unprecedented electricity demand but also accelerating the commercialization of innovative energy technologies. Investments in nuclear, geothermal, battery storage, and flexible grid solutions are critical to supporting this growth, while strategic procurement and infrastructure upgrades remain essential to ensure reliable, low-carbon power for the next generation of data centers .