Sign In or Create an Account.

By continuing, you agree to the Terms of Service and acknowledge our Privacy Policy

Energy

A New Plan to Treat Texas Data Centers Just Like Texas Solar Farms

Energy procurement expert Arushi Sharma Frank wants to apply “connect and manage” to AI development.

Texas as a cord.
Heatmap Illustration/Getty Images

Everyone knows now how great Texas is for renewables. Its particular combination of sun, wind, and permissive market structure has led the state to overtake even California in clean energy generation. At the same time, however, the state is nervous about data centers and their effects on the grid, even passing a law this past legislative session to more closely examine the data center industry and to establish protocols for curtailing data center operations when electricity is tight.

But what if you could do for data centers what Texas has done for renewables? That’s roughly the idea Arushi Sharma Frank, who helped bring Tesla’s energy business to Texas and is now an advisor to Nvidia-backed Emerald AI, has come up with.

On Friday, Frank filed a proposal with ERCOT, the electricity market that sits outside federal regulation and covers about 90% of the state, that would reform its rules to allow data centers to connect to the grid much faster. The rough idea is that by applying ERCOT’s existing “connect and manage” system for getting new electricity generators on the grid to new large demand sources like data centers, the data centers can get power more quickly — if they can handle not getting access to the grid sometimes.

The proposal “creates the basis of connect-and-manage of load using the existence system that ERCOT already has for generators and batteries,” Frank told me.

Her idea would reward data centers for being able to modulate how much electricity they need in the interconnection process. This could mean that data centers get credit for curtailment and for having their own generation on site. And crucially, unlike a widely-panned proposal by PJM Interconnection to essentially mandate that some customers be forced to curtail their energy use, the ability to curtail or self-power a data center would result in faster interconnection, not simply the cost of doing business.

Frank pointed to chip designer Nvidia’s recent announcement that it would back a Virginia data center using Emerald AI software to smooth out power usage, saying she wants to be “able to actually do that at scale” for “any developer in Texas.”

Getting power for data centers is one of the biggest barriers to getting them built, and so anything that can deliver faster interconnection without foisting enormous new costs on the system as a whole counts as a win-win. With this system in place, Frank told me, data centers and other large loads could “invest in firming their own power needs before major transmission upgrades get built, enabling them to voluntarily choose to be flexible participants on the grid in exchange for earlier interconnection.”

Texas has been able to deploy wind, solar, and batteries so quickly, many energy policy experts and developers say, precisely because of connect and manage, whereby new generators can get on the grid after just a local grid study, without having to examine their effect on the whole system, which most of the country’s grids require. After these system-wide studies often come expensive transmission upgrades, the costs of which are passed on to all electricity customers in the form of higher bills. This process, Duke University’s Tyler Norris has written, “can often make generators financially unviable, introduce uncertainty for project economics, and delay interconnection by years.”

That level of extensive review is partially responsible for the interconnection delays seen in the rest of the country, which can stretch to as long as several years. Projects in Texas take on average two years to complete the interconnection process, according to the trade group Advanced Energy United.

The trade-off for allowing new resources onto the grid without those upgrades means that they’re more likely to be curtailed if the amount of electricity they generate overwhelms the grid — the “manage” part of “connect and manage.” Frank made an analogy to me between a data center and an 18-wheeler, which might be allowed to start its journey sooner if it agreed in advance to get off the road in the case of heavy traffic.

Frank delivered her proposal along with support from a group of big-name and deep-pocketed stakeholders, including former Loans Program Office chief Jigar Shah, renewables developers like Cypress Creek Renewables, and a number of datacenter developers and technology providers.

In comments on the proposal, Agentic Infrastructure, which works on powering data centers, said that Frank’s plan will allow for “private capital investment to energize with dispatchable service ahead of the timeline required for expansion of firm network service,” which would ensure that “the risks of serving rapid load growth are managed privately while the economics benefits of load growth are socialized to the public rate base.”

In other words, more users of electricity would come online faster, allowing them to make payments to utilities and split up fixed costs among all customers, while the developers would take on the risk of not always being able to power their data centers.

In a best-case scenario, the proposal could be approved at an ERCOT board meeting early next year, Frank said.

Allowing flexible large loads to connect faster is “the most viable way for loads to actually invest with their complex webs of financing and technology partners in creating dispatchability,” she added.

“Everyone is talking about” how important dispatchability is, Frank told me, but “no one is doing anything about it, except for the proposal at PJM and random one-off deals that folks like Google are doing.”

“What makes ERCOT different,” Frank said, “is that it is a place that gets national attention, and it can get national attention because things generally just happen faster there.”

Yellow

You’re out of free articles.

Use code: CWNYC30 to save 30%.
Subscribe to access Heatmap’s exclusive polling and expert analysis of energy, climate change, and sustainability, now just $99/year $69.30/year.
To continue reading
Create a free account or sign in to unlock more free articles.
or
Please enter an email address
By continuing, you agree to the Terms of Service and acknowledge our Privacy Policy
Politics

The Bipartisan Buddies With a Plan to Fix Transmission

With a permitting deal seemingly on the horizon, Republican Gabe Evans and Democrat Scott Peters may be about to see their partnership pay off.

Gabe Evans and Scott Peters.
Heatmap Illustration/Getty Images

The fate of permitting reform legislation that could smooth the way to all kinds of new and improved energy infrastructure — including transmission lines and renewables — is currently hostage to opaque discussions between Senate committee chairs. Rhode Island Senator Sheldon Whitehouse, the Democratic ranking member of the Senate Environment and Public Works Committee, told a Rhode Island business group earlier this week that “we’re actually in a pretty good place on permitting reform,” and that there was “maybe another week of negotiations.” Whitehouse’s Republican counterpart on the EPW committee, West Virginia Senator Shelly Moore-Capito, told Semafor on Friday that any bill has “got to pop out of here in the next 48 hours.”

If that’s going to happen, it will be because Republicans and Democrats have decided it’s worth it to get along. Any deal will eventually have to be voted on by the House, which has already produced several bills on a bipartisan basis, and even passed one — the SPEED Act — late last year.

Keep reading...Show less
Green
Energy

Nuclear Is Cheaper Than We Think It Is

A new analysis by a one-time atomic energy opponent makes a bull case for big reactors.

Nuclear reactors in a wallet.
Heatmap Illustration/Getty Images

If you know anything about the cost of nuclear energy in America, you probably are aware that the most recent reactors built — the only two new ones designed, planned, and constructed since the 1990s — were budget busters. Units 3 and 4 of Southern Company’s Alvin W. Vogtle Generating Station in eastern Georgia were the first of a new generation of reactor technology ever to be deployed in the U.S. Construction delays, changes to the design, and corporate bankruptcies ultimately sent the price of the pair of Westinghouse AP1000s — the Ford Mustang of American nuclear technology, with safety features that essentially make them not just powerful but also meltdown-proof — to nearly $40 billion, or about $16,350 per kilowatt.

But the U.S. once built reactors for half that — and it did so in the chaotic aftermath of the nation’s worst civilian nuclear accident, when mounting regulations made atomic power construction more onerous than ever before.

Keep reading...Show less
Yellow
AM Briefing

Strait Shooters

On wind’s waitlist, pumped hydro, and Taiwanese nuclear

A ship in the Red Sea.
Heatmap Illustration/Getty Images

Current conditions: Oman’s Ayn Athum Waterfalls burst to life this week as rain battered the Gulf nation’s southwestern Dhofar governorate • Severe monsoon flooding has deluged parts of the American Southwest, including Navajo Nation, where at least three people have died • Tropical Storm Dujuan is barreling toward Japan, where it threatens flooding and landslides in Tokyo and Chiba.


THE TOP FIVE

1. Oil prices dip as U.S. meets with Houthis

When the Houthis stormed Yemen’s Red Sea coast last week, the Iran-backed rebels gained new ground from which to attack boats passing through the vital shipping lane, extending Tehran’s reach from the Persian Gulf’s hotly contested Strait of Hormuz to the waterway on the opposite side of the Arabian peninsula. In response, oil prices surged. But the price per barrel of crude is slipping again as the United States has rebuked Saudi Arabia’s requests for help routing the militants, instead seeking a deal that keeps the Bab al-Mandab Strait open to American and Israeli ships. Over the weekend, U.S. diplomats met with Houthi officials in neutral Oman, Reuters reported. Following the talks, the Times of Israel reported that Houthis promised not to attack any Israeli or commercial ships of any kind, only those linked to Saudi Arabia, which has funded the Yemeni government’s campaign against the rebels.

Keep reading...Show less
Blue