For data centers, a little flexibility goes a long way

The explosive energy demand from data centers is breaking our grid, pushing desperate developers to build their own on-site gas plants just to get online. To figure out how we avoid locking in decades of new fossil fuels, I’m joined by Camus CEO Astrid Atkinson and Princeton’s Jesse Jenkins to break down their proposed alternative. We dig into how adopting flexible grid interconnections and clean, battery-backed “power parks” can meet this massive load growth without abandoning our decarbonization goals. (PDF transcript) (Active transcript) David Roberts Hello and greetings, everyone. This is Volts for March 25, 2026: “For data centers, a little flexibility goes a long way.” I’m your host, David Roberts. By now, most Volts listeners are familiar with the crisis facing the electricity sector: after decades of plateau, demand is rising again, quickly. Giant data centers are banging on the door, demanding to be hooked up to the grid. Interconnection queues are clogged and some grids, like PJM’s, are basically maxed out. Everyone — utilities, PUCs, legislators, and the public — is scrambling to figure out how this should work, how the system can grow to accommodate the AI revolution without placing all the costs and risks on ratepayers. One solution that is gaining considerable attention is flexibility in data centers. Conventional energy models, including those used by utilities to project demand, assume data centers are always on, always consuming at their rated level, which, in the case of some of these new data centers, is as much as a gigawatt. Guaranteeing a gigawatt of steady service 100 percent of the year, come what may, is no small thing. That’s one reason utilities have been so slow to connect these things. But what if they didn’t have to guarantee 100% of service 100% of the time? What if, say, 10 to 20% of the time, data centers could survive on their own, running on their own batteries and backup generators? That little bit of flexibility could enable utilities to avoid tens of millions of dollars in grid upgrades and connect many more data centers much faster — at least, that is the argument in a new study and white paper on the subject. It’s a team-up among the energy analysts at the Princeton Zero Lab, the energy modelers at encoord, and the flexibility-software startup Camus. A couple of those names probably sound familiar to you! Indeed, today’s guests have been on Volts before and are some of my all-time favorite guests, and people. I have Astrid Atkinson, the CEO of Camus, and Jesse Jenkins, the head of Princeton’s Zero Lab. We’re going to discuss the model for data center flexibility and the benefits it promises. With no further ado. Astrid Atkinson, Jesse Jenkins, welcome back to Volts. Thank you so much for coming. Jesse Jenkins Thanks, Dave. Astrid Atkinson Yeah, thank you. David Roberts There’s a lot to talk about here, a lot going on, so much going on in this space. But I want to start before we get to what they ought to be doing, what data center developers ought to be doing, let’s talk briefly about what they are doing. My impression, and tell me if this is wrong. My impression is that everybody involved is in a big old sprint for gas. I look out there, I see data centers scrambling for off-grid gas capacity. I see utilities scrambling to build gas capacity. I see gas companies gearing up for historic demand, no end in sight. This whole thing looks like a gas disaster to me. Is that wrong, Jesse? Maybe you start. It looks to me like the only way these guys can figure out how to get data centers online at the moment is by surrounding them with a bunch of frickin jet engines. That seems crazy to me. Is that in fact crazy? Jesse Jenkins I would say that’s definitely where the zeitgeist is at right now. The default assumption is that you’re just going to build a bunch of gas power, whether it’s a combined cycle plant or a simple cycle open cycle gas turbine, the jet engine you mentioned, or even reciprocating internal combustion engines, basically big diesel gensets that can run on natural gas. Halcyon is tracking 85 gigawatts of gas plant additions currently planned across the US and it is quite a potpourri of different designs. Some of those are grid connected, some of those are utilities. Some are happy to say, “Yep, I’ll build 2 gigawatts of new gas generation if you connect to my transmission grid.” But a good chunk of those, and a very rapidly growing piece this year, is behind-the-meter projects. Projects where they’re actually just trying to build these generators on site. One emblematic example is the x.AI Training center outside of Memphis, the so-called Colossus facility outside of Memphis, Tennessee. It’s right over the border in Mississippi, parts of it anyway. They basically rolled up with over a dozen gas turbines on trucks, on the back of a flatbed, plugged those in, and have been running these intended-to-be-temporary generators pretty much nonstop. They initially tried to sidestep air pollution rules, saying that they were not applicable because they were mobile generators. The EPA has since said, “No, we thought about this before. Those count.” But the Trump administration’s EPA is not enforcing any rules. They are violating the rules but with no enforcement to rein them in. Now they’re asking to build over 20 permanent gas generators on site, to which the public resoundingly said “no” recently at a February open meeting in Mississippi. That’s emblematic. They are the first ones to get to a gigawatt collective scale training capacity and have been touting that. They did that by building their own small, meant-to-be-temporary gas generators and just running them continuously in order to avoid having to wait for projects to come online on the grid and supply their energy. Once folks saw that and other projects have been announced, that model has started to spread. It seems to be the default stance of many developers right now: the grid process is broken, so forget it. I’m going to go around it and build my own generation on site. Even if that’s not an efficient combined cycle power plant, which is what you would want to do if you were using gas, it doesn’t matter, they’ll pay for it. David Roberts Before we move on, I just want to talk about, aside from climate change — there’s a lot of emissions — but I just want to ask about operationally. It’s crazy, isn’t it? This is not how you would run a data center if you were setting up to run data centers in a rational way. These turbines they’re using are not meant to do what they’re doing. Am I wrong about that? Astrid Atkinson Yeah. I can offer a little bit of perspective on this because part of my past life was in the reliability organization at Google, which deals a lot with the intersection between software and physical infrastructure. I have some experience working with data center infrastructure. Firstly, there is a real risk of locking in a lot of gas generation to meet this demand growth need. On-site, fully off-grid natural gas generation is not great from a data center perspective. The reliability profile is not great. You need a lot of redundancy to be able to do this on site. Personally, I would be concerned about things like vulnerability to natural gas price fluctuations as well as deliverability challenges. David Roberts The more I think about this, the crazier it seems. If one of these big gas generators that’s off grid goes out, these data centers want five nines reliability or whatever it is. If one of these generators goes out, you have to have on site backup generation sufficient to cover that. You are building double the capacity you need in natural gas on site. That seems crazy. Astrid Atkinson Yeah. Apart from anything else, they’re not quick to build. It’s not clear to me that this is actually a really fast path to power solution in the way that folks on the tech side are hoping it is. In practice, what we are seeing is that while there’s a l…