Data centres are driving an unprecedented surge in US clean energy development, paradoxically boosting wind, solar and battery storage even as their vast electricity demands threaten climate goals. Observers warn that while the centres are propelling renewable growth, they remain a climate nightmare by also keeping ageing fossil fuel plants online.
Utilities across the country are racing to build new gas plants or extend the life of coal and gas facilities to meet data centre demand, derailing planned transitions to renewable energy in states like Michigan. The gas industry, including fracking and pipeline firms, is powering much of the boom, with some companies building new plants solely for data centres and benefiting from the Trump administration's support.
However, grid connection delays of up to 12 years are forcing big tech to invest heavily in self-generation through the quickest and cheapest options: battery storage, solar, wind and fuel cells. This has boosted clean energy stocks, with the iShares Global Clean Energy ETF rising 52% over the past year after an 80% decline. Companies like Nextpower, which reported 20% year-on-year growth and bought data centre battery producer Prevalon, are at the forefront.
Google recently built the world's largest grid-scale battery for a data centre in Minnesota and is expanding off-grid renewable development in Texas, combining wind, solar, batteries and gas. In Wisconsin, regulators are approving 15 wind or solar facilities to serve Microsoft and Oracle data centres, though some include natural gas. In Michigan, DTE Energy is building a 330 MW battery system instead of a gas plant to support a 1.4 GW Oracle data centre, with Oracle covering the cost.
Not all clean energy segments benefit equally; data centres spur on-site solar and batteries but have little direct impact on home rooftop solar. Clean energy consultant Douglas Jester noted that tech companies are motivated by speed to power and preference for clean energy, not just environmental concern. Economist Lucas Davis added that the 'huge increase' in demand is primarily driven by need, not altruism.
