When Data Density Meets the Power Grid: Engineering for the Next Decade

For years, data centers were remarkably predictable. Designs stayed consistent, power needs were steady, and cooling was straightforward. Between 2010 and 2016, most racks drew only 3–4 kilowatts (kW). Engineers could reuse the same blueprints across projects and know exactly what to expect.

That world is gone.

Today, AI and high-performance computing have rewritten the rulebook.

According to McKinsey, global capital spending on data center infrastructure (excluding IT hardware) is expected to exceed $1.7 trillion by 2030, driven largely by AI and high-performance computing. The U.S. alone will need to triple its annual power capacity to more than 80 gigawatts by the end of the decade.

As we look towards the future, it’s clear that the power requirements for data centers are growing exponentially. This rapid change compels us to completely overhaul our approach to data center design. We are now working on designs for racks that can exceed 500 kW each, which is a monumental jump from just a few years ago. This scale of change is not just an incremental step, but a giant leap that demands innovative solutions. With this kind of power requirement, everyone in the industry, including operators, utilities, and local communities, needs to rethink how we build, power, and integrate our digital infrastructure. It’s a collective challenge that requires us to be forward-thinking and collaborative.

The power perception problem

Data centers are often portrayed as a strain on utilities, causing higher utilities rates for consumers, but the reality is shifting: they’re becoming part of the solution.

One of the biggest untapped opportunities lies in backup generation systems. These assets sit idle more than 99% of the time, yet they represent meaningful capacity that can be leveraged to support the grid. During peak demand or emergencies, backup generation systems can feed power back to the grid or allow the data center to disconnect from the grid, effectively transforming digital infrastructure into a stabilizing force for surrounding communities.

Large scale data centers are also contributing financially, funding substations and distribution which benefits the surrounding communities in the long term.

A shift in how we think about resources

Cooling remains one of the biggest variables in data center efficiency, and it’s also where perception lags behind progress. Water use has become a key concern, especially in drought-prone regions. That’s why more operators are moving toward air-cooled chillers, systems that avoid evaporation and water consumption altogether.

A few years ago, this tradeoff might have seemed unnecessary. Now, it’s clearly the right long-term call. Eliminating water use helps protect a scarce resource, and it simplifies permitting and environmental impact. It ensures that communities do not see an impact to their water supply as well.

We've made significant strides in using what we've already built. For instance, facilities that were previously utilizing only 40% of their utility service are now operating at an impressive 85%. This significant improvement means we are delivering much more compute power per square foot, all while drastically reducing wasted infrastructure. This efficiency allows us to use far less concrete, steel and land to achieve the same amount of compute. Not only does this help us cut costs, but it also aligns perfectly with our commitment to sustainability.

Collaboration over competition

One of the most important shifts underway is cultural, not technological. Everyone from operators to utilities is realizing that the density challenge can’t be solved in isolation.

That’s why we’ve started convening cross-industry working groups, including peers and even competitors, to align on design standards, containerized strategies, and cooling efficiency. When we share what’s working, we move the whole industry forward—faster, safer, and more sustainably.

Rethinking our energy mix

As we plan for higher power loads, the conversation about energy diversity has to get more serious. It’s no secret that renewables can be challenging, both financially and from a time to market standpoint. When it comes to renewable energy development and growth, data centers play a crucial role. As one of the largest participants in renewable energy, data centers are collaborating closely with governments, communities, and producers worldwide to ensure that renewable energy becomes an integral part of the industry's future.

While we’re navigating how to best invest in renewables that deliver the reliability our customers depend on us for, small modular reactors (SMRs) can help fill the gaps.

Nuclear technology has evolved from its early days. Small modular reactors are compact, inherently safe, and have powered U.S. naval vessels for decades. Deploying them commercially could help decarbonize while providing consistent baseload energy to both data centers and local grids. Imagine a world where an SMR is placed adjacent to a fossil fuel generation plant and allows the fossil fuel plant to strategically sunset providing a carbon free footprint. While it’s still years away, if we’re serious about net-zero commitments, nuclear deserves a seat at the table.

The next chapter of containerization

The word “containerized” used to be associated with “temporary.” Now it means precision-built systems designed off-site, tested in controlled environments, and deployed anywhere in the world. This approach shortens timelines, improves quality, and lets us scale responsibly.

Analysts estimate that applying containerized, end-to-end delivery models could cut build timelines by up to 20% and reduce costs per project by 10–20%, a savings potential of $250 billion globally through 2030 if the industry scales smarter rather than just bigger. Ultimately, containerization is about flexibility.

Looking ahead

Exploding rack densities are forcing a rethink not just in engineering, but in mindset. Data centers are no longer just power users, they’re becoming active players in how energy is managed and shared.

That’s a good thing. It’s a sign of an industry moving from consumption to collaboration—where resilience, efficiency, community and environmental impact are all part of the same conversation.

The next generation of facilities will act as intelligent energy hubs – capable of storing, generating, and even returning power to the grid. New investments in on-site generation, grid partnerships, and renewable integration are redefining what “uptime” means. As these innovations take hold, data centers will be measured not only by megawatts consumed, but by megawatts contributed – turning infrastructure once seen as a liability into one of the grid’s most flexible assets.