More grid-changing technology is on the way. Regulators need to prepare
This article discusses the need for energy policy to proactively address grid-changing technologies, rather than reacting to crises. It highlights that data centers are currently dominating policy conversations due to their increasing demand, while new innovations like thermal batteries and advanced chip factories will also require serious regulatory consideration. The author emphasizes that future technologies must serve needs such as lowering peak demand, improving reliability, cutting emissions, and sharing grid upgrade costs.
Energy policy is often reactive, adapting to the dominant issues of the day. Currently, the conversation is centered on hyperscalers and data centers, which are significantly increasing peak demand, with the North American Electric Reliability Corp. (NERC) projecting a quarter rise in peak demand over the next decade. Regional transmission organization PJM is reportedly contracting with data centers to maintain grid stability, and ERCOT recently hit a record peak demand of 91.1 gigawatts in July.
However, the article warns that while data centers are a critical immediate concern, other emerging technologies like thermal batteries, grid-forming inverters, direct air capture, and advanced chip factories will soon require substantial policy consideration for their impact on the power sector. The author urges regulators to proactively address these innovations to prevent future crises, noting that waiting too long could close the window for effective policy intervention.
Any new technology integrated into the grid must fulfill specific needs, including reducing or stabilizing peak demand, enhancing reliability, lowering emissions, and equitably distributing the economic burden of grid modernization.