Why batteries, not gas plants, should be data centers' first choice
A Georgetown and Duke universities report urges states to prioritize batteries over gas plants for powering data centers, citing lower costs, faster deployment, and reduced climate and financial risks.
U.S. utilities and data center developers are planning over 90 gigawatts of new gas generation to meet AI-driven electricity demand, including both utility-scale plants and behind-the-meter generators. Researchers warn this expansion risks stranded assets if computing demand fails to materialize, burdening other utility customers with unnecessary costs. Batteries offer a modular and flexible alternative, avoiding costly grid expansions while absorbing data centers’ variable power loads, according to the report by Georgetown and Duke universities.
The report highlights that lithium-ion batteries cannot provide round-the-clock power but can meet large portions of data centers’ needs, with utilities and developers increasingly adopting them alongside gas. Unlike experimental solutions such as advanced geothermal or next-generation nuclear, batteries already show strong deployment momentum, making them a practical near-term choice for meeting data center demand.
State regulators can encourage battery adoption through policies like "bring your own new clean energy" tariffs, which require data centers to procure or pay for carbon-free generation and storage. Google has already signed onto such tariffs in Nevada and Minnesota, demonstrating industry willingness to comply with these requirements.
In restructured energy markets, where regulators have limited authority, states can still promote battery development via energy storage mandates, as seen in Illinois, Maryland, and New Jersey. The report emphasizes that all jurisdictions have viable options to accelerate battery deployment for data centers, regardless of market structure.