How Energy Storage Can Support the Hyperscale Data Centre Boom in the U.S.

The push toward 100% clean electricity in the United States—a goal significantly accelerated by the Inflation Reduction Act—has fueled nearly half a trillion dollars in renewable energy investment. But even that momentum faces a new test: the rising power demands of hyperscale data centres, driven by the surge in AI and cloud services.

The Challenge: A Grid Under Pressure

According to the Electric Power Research Institute, data centres may account for 9% of U.S. electricity demand within five years, double their current share. AI-powered technologies are a key factor, with some estimates suggesting they consume up to 10 times more power than conventional digital services.

While the U.S. has made considerable strides in energy efficiency over the past decade, those gains are no longer enough. Hyperscale data centres require a level of constant, 24/7 power availability that intermittent renewable sources alone cannot meet. The Federal Energy Regulatory Commission (FERC) projects that data center demand could reach 35 GW by 2030, up from 21 GW today.

Why Storage Matters

The article highlights a crucial point: energy storage will be essential to maintaining grid stability and ensuring reliable, clean power delivery. Backup systems are already standard at data centres, but as their load grows, so must the scalability and resilience of those systems.

According to Energy Vault—a global storage solutions provider—battery energy storage system (BESS) deployment reached record highs in 2023 and surpassed that with 9.2GW added in 2024 (as of November). These figures suggest a sector ready to rise to the challenge—if it can overcome key hurdles.

Three Key Technical Challenges

In conversation with Dr. Marco Terruzzin, Chief Commercial and Product Officer at Energy Vault, the article outlines three critical areas of innovation for energy storage systems located near hyperscale data centres:

• Space Efficiency: Lithium-ion batteries need substantial room for deployment. Vertical stacking and other space-saving designs are being explored to meet the footprint constraints of urban or co-located centres.
   
• Battery Degradation: Over time, lithium-based systems lose capacity. This can require expensive replacements or oversizing the original installation, which is costly and inefficient. Alternative storage methods, such as gravity-based systems or hydrogen storage, could offer longer-term resilience.
   
• Market Transparency: With numerous vendors and limited standardized solutions, developers frequently struggle to make informed purchasing decisions. More transparent procurement practices and product-specific chemistries tailored to data centres are urgently needed.
   

The Takeaway: A Potential Turning Point

Rather than view data centre growth as a threat to grid reliability, Mr. Derasmo encourages us to see it as a catalyst for innovation in the energy storage industry. With the right investments, policies, and technologies, energy storage can not only support growing demand but also accelerate the broader clean energy transition.

Acknowledgment

This article is based on “Meeting US power demands of the hyperscale data centre boom with energy storage,” authored initially by William Derasmo, Partner at Troutman Pepper Locke, and published by Energy-Storage. News. All insights, data points, and expert commentary—including those from Dr. Marco Terruzzin of Energy Vault and Mike Hall of Anza Renewables, and Electric Power Research Institute are respectfully credited to the source.

You can read the full original article here.