Data Centers May Need 40% More Power Than Previously Thought

Current conditions: Everywhere from the Midwest to New York City are bracing for snow today • The death toll from flooding in Southeast Asia has eclipsed 1,000 • Temperatures of 95 degrees Fahrenheit in French Guiana, the westernmost border of the European Union, have broken December records.

THE TOP FIVE

1. Data centers could need 40% more power than what was forecast just seven months ago

Data centers’ projected electricity demand has grown so much in the last seven months that BloombergNEF increased its forecast by nearly 40%. In a new analysis published Monday, the consultancy estimated that power demand from U.S. data centers will surge to 106 gigawatts by 2035. That’s 36% higher than BloombergNEF’s outlook published in April, “illustrating just how quickly the sector is expanding,” the consultancy wrote.

The finding illustrates the key challenge facing the grid as data centers complete construction far faster than new gas turbines, nuclear reactors, or even solar panels can be built and patched onto the grid. That reality has put new value on the ability of data centers to power down when the grid is overtaxed, a process Heatmap’s Matthew Zeitlin described as “one weird trick for getting more data centers on the grid.” It also shows why data centers are becoming so politically contentious that the “backlash,” as our colleague Jael Holzman put it, “is swallowing American politics.”

2. FEMA reinstates workers who criticized Trump

Back in August, I told you about how the Federal Emergency Management Agency suspended staffers who signed onto a letter criticizing President Donald Trump’s plans to gut the agency. Now the Trump administration has reinstated 14 employees placed on administrative leave after their signatures on a letter addressed to Congress were considered “misconduct.” In notices sent to the workers last week, which The New York Times reviewed, FEMA said the “misconduct investigation has been closed, and as a result you are being removed from administrative leave.” The notices did not disclose the probe’s findings, and FEMA’s parent agency, the Department of Homeland Security, didn’t respond to the newspaper’s questions.

The move comes as Illinois Governor JB Pritzker accuses Trump of politicizing disaster relief. The billionaire Democrat, who is widely discussed as a potential presidential candidate in 2028, said the White House rejected two separate requests for $130 million to help households affected by storms in late July and mid-August. E&E News called the denial “unusual” since “the damage documented by the administration was at such a high level that it would routinely lead to a presidential approval for disaster aid.”

3. The National Renewable Energy Laboratory gets a rebrand

The National Renewable Energy Laboratory is dead. Long live the National Laboratory of the Rockies. The lab’s focus on clean energy wasn’t unique. Nuclear power, for example, benefits from receiving the primary focus at sites such as the Idaho, Argonne, and Oak Ridge national laboratories. But the Department of Energy said Monday that the rebranding was part of an effort to broaden NREL’s scope. “The energy crisis we face today is unlike the crisis that gave rise to NREL,” Assistant Secretary of Energy Audrey Robertson, a key deputy of Secretary of Energy Chris Wright (whose unique professional history with Wright I wrote about last week), said in a statement. “We are no longer picking and choosing energy sources. Our highest priority is to invest in the scientific capabilities that will restore American manufacturing, drive down costs, and help this country meet its soaring energy demand. The National Lab of the Rockies will play a vital role in those efforts.”

In its press release, the Energy Department said NREL was formed amid the 1973 oil crisis and that the new name “reflects the Trump Administration’s broader vision for the lab’s applied energy research, which historically emphasized alternative and renewable sources of generation, and honors the natural splendor of the lab’s surroundings in Golden, Colorado.”

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4. Britain pulls out of controversial Mozambique LNG project Trump backed

Soldiers march in Mozambique. Ivan Bruno/Getty Images

In March, the Trump administration approved a $5 billion loan aimed to help restart the French oil giant TotalEnergies’ controversial liquified natural gas project in Mozambique. Though the project initially had international support, the southeast African nation has faced ongoing challenges from extreme weather and an Islamist insurgency, which mounted a deadly terrorist attack that caused work on the project to shut down in 2021. Troops from Rwanda have since come in to secure the area.

On Monday, however, the British government decided to pull its $1.15 billion loan, the Financial Times reported. Initially approved in 2020, the public financing faced fierce pushback from environmental and human rights groups. The Netherlands also announced Monday that it would stop backing the project.

5. Japan backs U.S. carbon removal startup Heirloom

Direct air capture is going big in Japan. On Tuesday morning, the U.S. carbon removal startup Heirloom announced investments from the Development Bank of Japan and Chiyoda Corporation, building on $150 million in Series B funding the company closed last year. That financing round also included investments from Japan Airlines, the industrial giant Mitsubishi Corporation, and the trading behemoth Mitsui & Co. The move comes as Japan’s greenhouse gas-trading system is poised to shift from voluntary participation to mandatory compliance next year, becoming Asia’s second-largest carbon market.

Heirloom had planned to build a giant DAC facility in Shreveport, Louisiana, as Heatmap’s Katie Brigham reported last year. But as our colleague Emily Pontecorvo wrote in October, the Trump administration looks poised to slash federal funding to support construction of DAC plants, making the fate of the Shreveport project unclear.

THE KICKER

In the race to develop next-generation technology to harvest water straight out of the air, AirJoule Technologies has a promising lead. The GE Vernova-backed startup is already publicly traded and has deals with major industrial giants such as appliance maker Carrier. Now the company has inked a deal with a hyperscaler to sell water to cool data centers and use waste heat from the servers to power production of that same water. In a press release, the data center company, Nexus Data Centers, said AirJoule’s “waste-heat-to-water approach provides a superior solution by utilizing thermal energy we are already generating to produce high purity water for electricity production and cooling systems.”

Editor’s note: This article has been updated to correct the relationship of the new investments in Heirloom to its previous funding round.