Powering The Future: The Role of Distributed Energy in the Era of Data Centers and EVs
This past year, the U.S. energy grid faced unprecedented strain, driven by a surge in demand fueled by the rapid expansion of data centers — specifically those supporting artificial intelligence (AI) and the growing adoption of electric vehicles (EVs). As AI continues to evolve and expand, AI-powered data centers alone are projected to account for 8% of the nation’s total energy consumption by 2030, up from just 3% in 2022. Meanwhile, the demand for electricity to power EV charging infrastructure is also increasing at a rapid pace. Together, these sectors are reshaping energy consumption patterns across the country with regions like Northern Virginia, Texas, and Georgia emerging as key hubs powering data centers in this new era of energy demand.
The challenge: the grid’s growing complexity
Georgia is a perfect example of how one state’s emergence as a major technology hub for data center development (amid the AI and EV boom) is playing out. It is positioned to be a key player in this shift with the state’s business-friendly environment and access to reliable, affordable electricity making it a prime location for the establishment of large-scale data centers. While areas like Northern Virginia and Texas have experienced early growth, Georgia Power forecasts that the state will drive the nation’s “second industrial revolution” over the next decade with energy demand from data centers alone expected to triple by the mid-2030s. This rapid rise in demand presents both a significant challenge and a unique opportunity for Georgia — and the broader United States energy grid — to adapt and evolve to meet the needs of a digital, electrified economy.
At the same time, the increasing adoption of electric vehicles is further intensifying the demand for electricity as the need for widespread charging infrastructure continues to grow. Cities in Georgia, such as Atlanta, which are home to both tech and automotive industries, are already experiencing sharp increases in electricity demand — not only for AI-driven operations but also for the growing number of EVs on the road. Together, these two rapidly expanding sectors are creating a perfect storm of energy needs that the current grid is struggling to manage.
As the demand from AI-powered data centers and EVs accelerates, grid operators across Georgia — along with the United States as a whole — must adopt innovative solutions to maintain grid stability and ensure resilience. This includes implementing distributed energy resources (DERs), such as microgrids, which can help manage local power loads, increase reliability, and ensure that energy is available when and where it is needed most. This solution offers a more flexible, resilient infrastructure capable of meeting the demands of a digitally connected and electrified future while reducing the risks of grid overload and improving overall reliability.
The game changer: the role of microgrids
Microgrids are rapidly emerging as key solutions for a more resilient, sustainable, and cost-effective energy future. These localized energy systems, capable of operating independently from the main grid during outages or periods of peak demand, are perfectly positioned to meet the evolving energy needs of Georgia and the country. By integrating renewable energy sources such as solar and wind, microgrids not only support decarbonization efforts but also enhance energy independence for high-demand sectors, including the rise of AI operations and EVs.
In addition to their environmental and energy independence benefits, microgrids are also equipped with advanced controllers and sensors throughout their infrastructure. This technology allows them to predict periods of heightened energy demand with remarkable accuracy. By leveraging this predictive capability, microgrids can dynamically adjust power distribution in real-time, ensuring that supply aligns with fluctuations in demand. This not only helps maintain grid stability but also boosts the overall reliability and resilience of the energy system.
Beyond their environmental and operational advantages, microgrids offer significant economic benefits. By generating and storing energy locally, businesses, municipalities, and energy providers in Georgia can reduce their reliance on the central grid, better manage energy costs, and even sell surplus power back to the grid. For high-demand sectors like data centers, microgrids present a reliable solution to ensure operational continuity amidst rising energy needs — all while supporting sustainability efforts through the use of renewable energy sources.
Breaking down barriers to widespread microgrid adoption
While microgrids hold immense promise, their adoption has been hindered by several barriers, including regulatory hurdles, high upfront costs, and a lack of standardized solutions. Many current microgrid projects are custom-designed and come with significant upfront investments — typically ranging from $2 million to $5 million per megawatt — which can deter widespread implementation.
However, innovative financial models such as “energy as a service” (EaaS) — alongside the development of standardized, modular microgrid solutions — are helping overcome these barriers, making these systems more accessible and scalable. Pre-engineered microgrids that integrate renewable energy sources and advanced energy management software can significantly reduce both deployment time and costs. This makes microgrids a more affordable and scalable option for both public and private sector energy users, offering a clearer path toward more widespread adoption.
Powering the future of America’s energy landscape
Looking ahead, Georgia’s leadership in driving the “second industrial revolution” holds immense potential, but this vision can only be realized if energy solutions are placed at the heart of its strategy. If approached thoughtfully, the state has the opportunity to set a powerful example for the rest of the United States, demonstrating how a strategic combination of innovative grid solutions, forward-thinking regulations, and investment in renewable energy can pave the way for a sustainable, resilient energy future.
By embracing microgrids and other DERs, the United States can help shape an energy infrastructure that not only meets the demands of today but is also agile enough to support the rapidly evolving sectors of tomorrow — from AI to electric vehicles.
In doing so, these key industry players have the chance to play a pivotal role in transforming the U.S. energy grid, setting the stage for a more decentralized, reliable, and sustainable national energy landscape.
