A piece written by Ed Ansett, Founder, i3 Solutions Group, on how data centres can expect to engage with utilities in 2022 and onwards.
The energy sector in transition
Data centre operators who may feel over scrutinised and under
sustainability pressures regarding the greenness of their operations could do
worse than to consider what their peers in the energy sector are experiencing.
Many of them will have chosen a career in energy as a stable,
mature and relatively unchanging industry. Today, they are tasked with nothing
less than achieving the global decarbonisation of power systems in less than a
This means achieving operational zero carbon by 2030 through the
phasing out of fossil fuels and transitioning to renewables, whilst keeping the
lights on. All the time assuaging the fears and concerns of governments,
regulators, activists and the market about the speed and reliability of
In the energy sector, legacy versus new means complexities.
As Thomas Egebo, CEO, Energinet
– Denmark’s power transmission system operator- told an Accenture hosted
session at COP26, there are 3 key topics to address:
- How to operate a fully invertor-based system
without balance and inertia from traditional generators.
- The development of tools, data and metrics to
analyse and plan a 100% green system in order to end uncertainty.
- Develop the control of the future – to harvest
As the grid decarbonises, the capacity and stability challenges
will increase. Due to the asynchronous nature of renewable energy sources such
as wind and solar, it is forecast that the closer the power system gets to
being carbon zero, the greater the likelihood of an imbalance between supply
In order to correct this imbalance, it is likely that the power utilities
will turn to the data centre sector to find additional decentralised, low
carbon capacity due to the vast quantities of their underutilised energy
storage and generation capacity.
How will a transitioning energy sector affect the data centre
The implications for data centres are profound and raise many
For instance, how can data centres engage with utilities as they
transition to net zero? What technologies are available for them to become part
of a sustainable partnership ecosystem with grid operators? How much untapped power
capacity do they already have? How can they provide and prove their
contributions are verifiably low carbon and sustainable?
It is clear that both older and newer data centres have untapped
capacity which could be made available to help with the greening of the grid.
But just like the utility grid, data centre systems comprise a mix of old and
new technologies. This raises a further question about how suitable current
infrastructure is for providing clean energy.
Natural gas engines, for example, might be seen as a low carbon
footprint solution to deliver dispatchable power back to the grid. Certainly,
lower than some other fossil fuels. How “low carbon” is actually defined and
measured has yet to be agreed, but it could be that utilities will reward those
able to provide low carbon capacity. Such an incentive may spur data centre
companies to invest in infrastructure to reap these rewards.
For data centres and the power companies, the end state is no
harmful carbon emissions. For the data centre sector, that state might look
like a world of closed carbon cycle bio-fuelled generators, and battery energy storage
back-up being powered by excess renewable energy.
Achieving integration between the grid and data centres in this
way will require a series of incremental steps, many of which are, as yet,
unclear and undefined. It will require flexibility on both sides as well as the
embracing of new business models to make it happen.
There are already plenty of initiatives planned and in progress.
There is, for example, the promise of 100s of GWs of offshore renewable energy
in the UK. There are also pilot projects within data centres for scaling up
hydrogen powered operations.
Should data centres overcome inertia towards Demand Response?
The challenge is that to date, there has too often been a
reluctance on the part of data centre operators to provide Demand Response
services. This is in part due to a focus on their primary function – that of maintaining
continuous power and cooling to the IT load. However, today DR could present a
logical bridge to further collaboration.
In the data centre operator space one possible scenario is that a global
giant – an Equinix, Digital Realty or CyrusOne on the commercial side or an
Amazon or Microsoft cloud hyperscaler – agrees commercial power sharing deals
with a utility. This could spark a rush to get some skin in the game.
But that begs a rather big question, if GWs of valuable power
capacity exist inside existing data centres then doesn’t the lack of discussion
between operators and utilities appear rather short sighted?
By ignoring demand response options data centre operators who don’t
engage with an energy sector in transition could find themselves being left out
in the cold, resulting in missed opportunities for gaining both new revenues
and green credentials. For a traditionally conservative sector where margins
are often under pressure, this would appear to be an unusually high-risk