Texas is no stranger to power grid problems. Between the heat that's only getting warmer, the aging fleet of power plants, and the challenges of integrating renewable energy, the system is fragile.
Now, the boom in energy-hungry computer data centers is adding a new element of risk this summer.
“How many are coming? It's still TBD, but we know they're growing explosively,” ERCOT CEO Pablo Vegas told lawmakers at one of two hearings this month in the state capital. Told to
Many of these centers use cryptocurrency, Vegas said. But more and more of them are being built to support artificial intelligence systems. They are attracted to the state thanks to low energy costs, minimal regulation and a thriving economy. But they use a Very of energy.
“If you do a Google search and just look up, 'What is ERCOT?' If you did this with a regular Google system versus an AI Google search, the energy needed to run an AI search is 10 to 30 times more electricity than doing a traditional Google search, Vegas said.
Many of the estimates you see online are on the lower end of this spectrum. But it's clear that Texas, in particular, can challenge growing energy demand.
Since the deadly blackout in 2021, state officials have worked to strengthen the power grid. They have launched programs to subsidize new power plants and improve transmission lines.
But, these things take years to build. Data centers — some that use as much energy as small cities — can be built in just months. That's a serious challenge for grid operators, says Doug Levine, who publishes the Texas Energy & Power newsletter.
“How can we build enough infrastructure to accommodate a new city popping up in six months, with no notice?” he asks.
Answer: You probably don't.
Renee Dominguez
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KUT News
'The most worrying thing'
State officials have long declared Texas “open for business.” Cheering on each victory, he lured the state with things like Tesla's new Gigafactory and Samsung's new microchip plant.
But now, some people wonder if data centers are worth it.
Cryptomines and data centers “create far fewer jobs than the incredible demands they place on our grid,” Lt. Gov. Dan Patrick posted on X, formerly known as Twitter, after the hearings. “Texans will ultimately pay the price.”
State lawmakers, likewise, grappled with questions about hearings this month on whether the state could curb data center growth, or force companies to pay for their growing energy transmission needs. can
“It's wild to think about,” Levin said. “It's a huge, huge break in the way things have been done.”
Assuming cryptocurrencies and data centers are here to stay, grid operators say they would like new rules to better monitor and possibly control the facilities' energy use.
Despite recent legislation forcing cryptocurrencies to register with ERCOT, Vegas told members of the House State Affairs Committee that about half of the companies still do not have registration.
“On Legislation […] What would be more helpful for ERCOT is to have more visibility into what these big loads are doing,'' he said. “And so a good place to start might be making sure we can track and possibly control. [energy] Lots of crypto.”
At a recent meeting of the ERCOT board of directors, Dan Woodfin, the group's vice president of system operations, said the inability to predict energy use by cryptocurrencies and similar large power users heading into this summer. was “the most worrying thing”.
ERCOT puts the probability of a blackout in August at about 12 percent.
Demand is outstripping supply.
In the electricity business, what Vegas proposes — reducing energy use by specific customers at specific times — is often called a “demand-side” solution to grid challenges.
The idea is that you can strengthen the grid more cheaply and quickly by reducing energy consumption than increasing supply.
“We can't build the grid fast enough to keep up with demand … before we have all kinds of crypto and data centers … moving to Texas,” Allison Silverstein, consultant and state and federal A former energy official told KUT.
Texas currently uses more energy than any other state. Silverstein has long advocated for raising energy efficiency standards in the state to help bolster the energy system.
A recent study by the American Council for an Energy-Efficient Economy found that improving efficiency standards in Texas would be a more economical way to strengthen the grid to reduce peak summer and winter energy demand.
Not only will this mean people will need less electricity to cool their homes, run their appliances and do business, Silverstein says, it will also go a long way toward keeping the lights on. .
But lawmakers and regulators have traditionally pushed to improve efficiency in Texas, a state known for producing and not conserving energy.
That may change, Silverstein says, as the challenges of rapidly growing energy demand become clear to those in charge of the Texas power system.
In a recent hearing, ERCOT's Vegas cited efficiency and demand response as an essential tool to keep the Texas grid stable.
Silverstein says the question is whether this rhetoric will translate into state policy.
“That's when we'll know they mean demand-side solutions, and it's not just hand-waving,” she says.