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Q&A

Are Renewables Really Benefiting From the Data Center Boom?

A catch-up with kWh Analytics’ Jason Kaminsky.

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Jason Kaminsky.
Heatmap Illustration

This week’s conversation is a catch-up chat with Jason Kaminsky of kWh Analytics, an insurance firm that works with renewable energy developers. I reached out to Kaminsky ahead of the new year because as someone with an arms-length distance from development, I find he is able to speak more candidly about market dynamics and macro-level trends – as well as the fears many have in rural communities about energy project failures, like battery fires. Seeing as the theme this week felt like “data centers forever,” I also thought it would be good to get up to speed on what he’s most focused on in that space, too.

The following conversation has been lightly edited for clarity.

Okay so, Jason – is renewable energy actually benefiting from the data center boom?

Renewables are supporting our load growth boom. Data centers are about a third of the projected load growth. So it is certainly a key component of what is driving demand broadly, but not the only component. The other pieces worth considering are the electrification of transportation, the reindustrialization of America, and the electrification of residential homes. But data centers are getting enthusiasm because of how quickly people are trying to deploy them.

The unique benefit renewables have is that they’re able to deploy quickly, and you need the benefits that storage has to handle these load centers.

How rapidly is the data center buildout and its associated infrastructure buildout actually happening, and how rapidly is this demand curve actually rising?

Remember, we’re not a developer on the front line, and a developer on the front line might have a better answer to this. But I’d say most of the activity today in the data center space is still quite a ways out. It’s either linked to a new facility or the planning of a new facility. Now, granted, we’re seeing it quite late in the process because we’re the insurance company, and so from an operational perspective, we’re not seeing it in the numbers yet. But it is in the forecasts, which is what you’re seeing, as well.

When it comes to concerns about renewable energy development at the local level, the last time we spoke was about project risk and the extent to which projects face weather risks, fire risks. Do data centers face these same kinds of risks?

The data center development ecosystem parallels very closely with the project development ecosystem with renewables.

What I mean by that is you have a few mega-developers, like the NextEras of the world, but instead it’s Meta and Google building these massive centers, these 800-pound gorillas. Then you have these companies that are equivalent to [independent power producers], a lot of people building mid-size to small-size data centers, and either building them on spec or with long-term contracts. Within that you have very different community engagements and quality, different power generation strategies and siting strategies, but there’s no universal data center approach. It’s a very stratified data center ecosystem.

It probably compounds the problem because you have more land being used. There are stories like the X data centers not getting permits for their generators, and resulting local pollution. There have been concerns in the media about heat effects and the way data centers use so much water.

Before, though, renewables were the focus. Now data centers are the focus and renewables are just kind of along for the ride.

Has the conversation around the renewable energy sector and its project-level business risks evolved in the year since we last spoke? Have data centers changed the conversation?

I would say that from a micro perspective, as you start pairing these facilities with data centers, one of the things you have to think about from a risk management perspective and the insurance perspective is the lost revenue due to a failure.

Generally, that’s electricity sales. There’s something called business income insurance, which, if you have a loss of a facility, you pay for lost revenue. But if you’re paired with a data center and your lost income is now compute income, your business income exposure can be much higher. So the resiliency of an asset or the reliability of an asset becomes that much more valuable and expensive.

I don’t think we’ve seen a lot of that yet in our ecosystem, but I think it’s coming.

What is your biggest prediction in the renewable energy space next year?

I think that the risk of China building more data centers than us and getting ahead of us in the race for AI – and the risk of energy inflation – is going to make some of these problems easier to solve from a risk perspective.

My hope is that the fear of being left behind and the fear of risk associated with energy inflation will lead to legislators allowing for more quick-to-deploy, cheap and clean power going to the grid. Renewables will find a way onto the grid. With just a little bit of legislative guidance and pathway, a lot can happen.

Yellow

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Spotlight

A Giant Data Center Offers a Permitting Reform Test Case

What would happen to Project Jupiter if the Bipartisan American Affordability and Jobs Act is passed?

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Project Jupiter.
Heatmap Illustration/Project Jupiter, Library of Congress

One of the nation’s largest data centers is struggling under permitting woes. So let’s play a game: would the bipartisan permitting bill in Congress make the path easier, or might the federal legislation be irrelevant to large hyperscalers under development today?

Meet Project Jupiter, a mega project in southern New Mexico in Dona Ana County under development by Oracle and OpenAI, with financial backing from SoftBank and political support from the Trump administration for being a part of Stargate, a major Trump administration public-private initiative boosting AI development. Project Jupiter would be one of the largest data centers in the country if completed and currently is expected to run on a microgrid powered by fuel cells converting gas to electricity, which the developers claim will burn much cleaner than a typical off-grid gas turbine power plant.

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Hotspots

The Trump Administration Is Still Messing with Offshore Wind Farms

And more of the week’s top news around project fights.

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The United States.
Heatmap Illustration/Getty Images

1. New England (and Maryland) – The Trump administration is still messing with offshore wind farms, even while trying to pass a permitting reform deal. Examining the court filings reveals why they may feel empowered to do it — and I’m not sure how this ends.

  • Last Friday, in a legal case brought by anti-wind activists, the Justice Department submitted a motion in federal court to send the construction and operations plan for Orsted’s Revolution Wind project in New England back to the Interior Department for more analysis. On Wednesday, the DOJ entered a similar motion in another case challenging the construction and operations plan for U.S. Wind’s MarWin project off the coast of Maryland in a lawsuit brought by the state’s coastal community of Ocean City.
  • Trump’s actions led some to question whether the president was sabotaging the deal, and others to claim the media coverage itself was an attempt to kill it. Going further, supporters of the bipartisan bill claimed the DOJ's motions were precisely why the bill should become law, implying it would guard offshore wind farms against this sort of maneuver.
  • However, for the bill’s backers, it’s worth considering why the Trump administration believes it has the legal authority to do this. It’s also time to ask whether the bill would actually protect these wind farms against this tactic.
  • To answer those questions, you have to rewind. On May 1, 2025, the Interior Department withdrew a Biden solicitor’s opinion instructing the agency to “strike a rational balance” between wind power and fishing interests. This revocation document is technically not in effect at the moment; one year later, a federal court ruled the opinion was potentially illegal as a part of a preliminary injunction on five anti-renewables actions requested by solar and wind trade groups. The Trump administration is contesting that ruling, and the administration has filed a notice of appeal.
  • In August, despite that opinion being in doubt, a federal judge granted Trump permission under the Outer Continental Shelf Lands Act to remand the construction and operations plan for the now-defunct Atlantic Shores offshore wind farm in the waters of New Jersey. U.S. District Judge Jia Cobb specifically wrote that Atlantic Shores failed to demonstrate the federal government had limitations under OSCLA on revisiting these plans and that the injunction from the litigation on appeal “did not prohibit all reevaluation of agency action.”
  • In the recent Revolution and MarWin filings, Trump’s Justice Department argues the construction and operations plans should be remanded under OSCLA without being vacated. The DOJ motions include claims that previous decision documents did not adequately explain impacts to commercial fishing and other industries that use OSCLA waters. It’s not clear if the administration will win these motions.
  • The bipartisan permitting bill would bar the Interior Department and other federal agencies from taking “any new action that would revoke, rescind, withdraw, terminate, suspend, amend, or alter a federal authorization or permit in effect on or after September 16, 2026,” or “any other action to interfere with or prevent the construction or operation at full capacity of a project that has secured all necessary federal authorizations and permits.” The restriction exempts cases where “the agency is required to take such action by order of a court.” As I wrote in our lengthy piece explaining the bill, this provision has a damages component that allows companies impacted by violations to pursue financial compensation.
  • Here’s the billion-dollar question I expect we won’t have answered unless the bill language is enacted and then litigated: Would the court order exception apply to rulings that grant these motions? Or would the developers be able to sue for damages?

2. Columbia County, N.Y. – New York’s renewable energy permitting office has rejected an upstate solar farm on farmland as a House Democrat representing the area joined hands with the Trump administration in publicly railing against the project.

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Q&A

The Developer that Builds Local Support with ‘Right-sized’ Data Centers

A conversation with Harmol Samra of Host Digital

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The Q&A subject.
Heatmap Illustration

This week’s conversation is with Harmol Samra, CEO of data center developer Host Digital. I asked Samra for a conversation because his team expressed a willingness to offer candid views on the industry’s problems with social license to operate — namely, why is the industry botching this so badly? From his point of view, many could learn a lot from industrial revolutions of the past, and they should be careful not to let mega-project expansions get in the way of broader acceptance of the data center sector.

The following conversation was lightly edited for clarity.

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