Microgrids could be critical to accelerating European data centre growth

The paper, Data centre dispatchable capacity: a major opportunity for Europe’s energy transition, seeks to offer new analysis on how data centre microgrids can reduce grid infrastructure spending, emissions and wasted energy, in addition to providing a balanced path for the energy transition.

Analysis, conducted by Wärtsilä and AVK, finds that powering data centres across Europe with microgrids could create a significant bank of dispatchable power and support the energy transition across the continent – with a combination of renewables, grid balancing engines and energy storage cutting data centre emissions and providing vital grid balancing.

The research comes as European data centre power demand continues to boom, predominantly on account of AI pushing an increase of 250% by 2030, yet access to grid-connected power can face monumental delays. Both companies conducting the research found that, with Europe’s grid facing constraints from high energy prices and grid connection queues, data centre operators continue to harness off-grid solutions to power data centres.

Microgrids, when successfully connected to the grid, can create a significant bank of flexible capacity for balancing the grid across Europe. They can empower data centres to act as community energy hubs and balance energy needs between local infrastructures and data centre operations.

“The growth of AI over recent years has been extraordinary and as it continues to transform the way we live and work, it drives a need for more energy,” said Anders Lindberg, president of Wärtsilä Energy and executive vice president of Wärtsilä. “This is causing significant challenges for grid operators across Europe, who are struggling with rising costs and up to a 10-year waiting time for a grid connection.

“By investing in microgrids, data centres can sidestep energy constraints and, with the right technology mix of renewables, grid balancing engines and energy storage, can ensure their emissions profiles and costs do not outweigh the huge benefits that AI brings.”

Engine power plants can bring cost efficiencies to data centre power generation. Modelling an 80MW data centre, the research found that a combination of engine power plants, renewables and energy storage provides the lowest levelised cost of electricity at 108 EUR/MWh in comparison to three other real-world scenarios.

The emissions of engine power plants can also decrease as sustainable fuels become commercially available.

“Through investing in flexibility, microgrids can have the lowest possible cost, while cutting emissions dramatically compared to other pathways, including turbines. This flexibility can have a significant, positive impact on the continent’s digital and energy transition,” Lindberg adds.

By current estimations, 40% of existing AI data centres will be operationally constrained by power availability by 2027. AVK and Wärtsilä suggest that microgrids will be able to take new strains off the grid in the short term. When grid connection is achieved, the excess energy can be sold.

As well as furthering cost reductions for data centre operators, this solution could provide vital flexibility to Europe’s power challenges.

“The answer to the challenges we face in combatting climate change is as much to do with changing behaviours as developing new technologies. And the key to behavioural change is the recognition that there are different ways of doing things,” said Ben Pritchard, CEO at AVK.

“The solutions outlined in this paper are not impractical; they are based on real-world cases and calculations. All that’s needed to make them more widespread is for investors, operators, equipment suppliers, planners and policy makers to recognise the widespread benefits that sharing dispatchable data centre capacity with the grid can bring and pass that knowledge on.”

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