Energy storage ‘needs to last longer as heatwaves and data centres strain infrastructure’

As extreme heat events become more frequent and prolonged, grid operators are discovering that current battery energy storage systems (BESS) may not be equipped to handle the strain.

“We’re trying to optimise the grid versus build for that quarter of a percent of the year”—referring to extreme peak demand days. “We’re trying to come closer to that max line, and so it’s less pointy and more rounded. That requires longer duration storage. It just does,” Sisto says.

Most deployed grid batteries today offer 1-hour to 4-hour duration, which is enough to shave peak demand, but insufficient for multi-day heatwaves.

“As we start to get into more generation constraint, that obviously needs to stretch longer,” Sisto notes.

Sisto cites a figure from a recent Bloomberg conference, stating that approximately 70% of US power generation is approaching retirement age between now and 2035. Gas plants and fossil fuel infrastructure will either need to be fully replaced, or there will need to be a transition to renewables backed by long-duration energy storage (LDES).

“Even if half of it is renewable, that is a massive amount of change in terms of the consistency of power generation,” Sisto says. “You are definitely going to need storage and LDES to be able to back that up.”

Data centres

Adding complexity to the equation is explosive data centre growth. Major campuses from tech giants like Google, OpenAI, or Meta, can consume power equivalent to an entire city. Sisto likens it to “the entirety of San Diego turning on.”

A May report from the US Congressional Research Service notes that “US data centre annual energy use in 2023 (not accounting for cryptocurrency) was approximately 176TWh, approximately 4.4% of US annual electricity consumption that year”

It continues, “Some projections show that data centre energy consumption could double or triple by 2028.”

Sisto Explains, “Your house can use more electricity than it typically does, right? The literal wire from your house to the street pole transformer is able to generally use more electricity than you’re using at any one moment in time.”

“So, when you get a July heatwave and your air conditioners are full bore, and not only that, but they’re straining because they’re not able to truly keep up, and then all of your electronics and everything are also working harder, your fridge is working harder—all of that, right? Your usage goes up because you’re not yet at 100% of what the literal wire is able to transmit.”

Unlike residential users, who can have that headroom to increase electricity consumption during heatwaves, data centres may already operate at maximum grid connection capacity year-round, according to Sisto’s assessment of emerging trends.

“For data centres, it seems to me—and this is a little bit of my own opinion in terms of what’s coming—but it seems to me they will be running 100% of the time.”

As a result, data centres may actually reduce computing output during extreme heat. “Because their cooling will take up more of a percentage of their available energy, their compute will probably be lower than in January, when the cooling is less energy intensive,” he notes. 

Market response

The market is responding along two tracks. Data centres, facing years-long grid interconnection delays, are building self-contained “power islands” with on-site generation and storage.

Simultaneously, utilities are preparing for unprecedented load growth while managing ratepayer affordability concerns.

“Data centres don’t want to be microgrids at the end of the day,” Sisto says. “They prefer to have a stable grid connection and offload that. They just can’t right now.”

The transition period between now and 2030 may be more likely see hybrid approaches such as partial on-site builds that eventually transition to grid interconnection as infrastructure catches up with demand.

As the grid evolves from serving point peaks to managing sustained high-demand periods, there seems to be at least a recent trajectory toward LDES.

At an industry conference in April, Francesco Oppici, co-founder and CCO of carbon dioxide-based LDES company Energy Dome, noted, “In the last couple of years, we have seen mainly here in the US, the 8-hour application, being used to bring capacity for data centres.”

Lucy Metzroth, principal innovation technology consultant, corporate development, at utility Xcel Energy, which is piloting Energy Dome’s technology, added at the same conference session, “We see a huge opportunity with large load customers as well, and they need speed to power, things that are available. We’re very interested in other things like geothermal or nuclear, but we need to be able to deploy capacity right now.”

This is underscored by the growing trend of data centre developers using LDES technology, seen in Meta and ‘multi-day’ energy storage startup Noon Energy’s 1GW/100GWh data centre deal, and another announcement, last year, from Energy Dome, that Google would be investing its technology, among others.

“Nobody’s ever had a battery and said, ‘Yeah, that lasted long enough, I don’t need any more.’ There’s no way we’re going to say, ‘Okay, four hours is enough.’ It’s just going to continue to expand,” Sisto says.