With data center cooling and power demands doubling by 2030, what’s the environmentally responsible path forward for AI infrastructure?
Every watt powering computing generates heat. And today’s high-performance computing (HPC) workloads are pushing rack densities beyond 140 kilowatts (kW) (see Figure 1), with some chips exceeding 1000 watts (W) in thermal design power (TDP). Cooling systems are working harder to manage soaring thermal loads, driving up energy consumption. And with AI adoption accelerating, global data center power demand is projected to double by 2030.
Figure 1. Rack density is increasing, indicating a higher concentration of servers or equipment within a defined space. Source – Omdia, Rack Density Data
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To meet this challenge amid power constraints and evolving emissions regulations, operators are turning to hybrid energy solutions. By combining alternative energy, or non-fossil-based sources, with other distributed energy resources (DERs), data centers can reduce dependence on strained grids. Alternative energy integration with DERs, such as hydrogen fuel cells, battery energy storage systems (BESS), and grid-interactive uninterruptible power supplies (UPSs), can improve energy efficiency and carbon profile.
Data center cooling can't fail
Power instability threatens data center cooling systems, and even brief disruptions can trigger thermal shutdowns that damage hardware and cause costly outages. According to the Uptime Institute, one in five outages now costs over $1 million, while many others exceed $100,000 (see Figure 2). With AI supporting critical sectors like finance, government, and healthcare, even short cooling failures carry outsized risks.
Demand is outpacing supply
But even with hybrid energy solutions, operators still face global regulatory squeeze. Europe enforces capacity caps and phased approvals (e.g., Ireland) to manage grid stability. The U.S. prioritizes tax incentives and grid modernization, with stricter efficiency mandates. In denser urban markets like Singapore, elevated energy standards dictate design. For operators, the challenge is clear: meet evolving rules while scaling computing.
Figure 2. More than half (57%) of respondents to Uptime Institute’s 2025 survey reported their most recent significant outage cost over $100,000, with 20% exceeding $1 million, reflecting direct, opportunity, and reputation costs. Source: Uptime Institute
Data center alternative energy applications
Alternative energy integration involves connecting energy sources like solar, wind, and bioenergy to existing power grids. This approach requires managing their variable output to maintain a steady and reliable electricity supply. Alternative energy integration uses technologies like energy storage and smart controls to improve grid efficiency and resilience while lowering environmental impact.
Power purchase agreements (PPAs)
Power purchase agreements (PPAs) enable data centers to contract solar or wind energy directly from generators. Operators can maintain predictable, environmentally responsible electricity for continuous data center cooling operations by securing fixed-capacity contracts. Moreover, PPAs can reduce dependency on volatile grid power and shield against price fluctuations.
Always-on microgrids with BESS
Operators can deploy always-on microgrids by integrating solar or wind power generation with BESS to stabilize power for critical systems, like data center cooling. The batteries store surplus power and release it on demand, eliminating disruptions due to intermittent generation. This maintains uninterrupted cooling even when real-time generation drops. At the Vertiv Customer Experience Center in Delaware, Ohio, Vertiv implemented a 1-megawatt (MW) AC solar photovoltaic (PV) array and a 1-MW BESS into an always-on microgrid (see Figure 3).
Figure 3. The Vertiv™ DynaFlex Battery Energy Storage Systems (BESS) utilize lithium iron (LFP) batteries to deliver utility-scale, always-on power supply. When integrated with the Vertiv™ DynaFlex Energy Management Systems (EMS), these systems enable sophisticated energy management, including demand management and the potential to monetize excess energy back to the grid. This integration maintains seamless transitions between various energy sources, including solar or wind power, for maximized efficiency and reliability.
BESS with grid-interactive uninterruptible power supplies (UPSs)
When data center solar or wind power generation drops, a grid-interactive UPS seamlessly switches to BESS to discharge stored energy. Simultaneously, these UPSs stabilize grid frequency by rapidly adjusting charge/discharge cycles to compensate for energy intermittency. This dual function of storage and grid balancing enables data centers to maximize alternative energy usage while maintaining uptime, even with variable energy production.
Hydrogen fuel cells as backup power and utility source
Fast-start polymer electrolyte membrane (PEM) fuel cells installed at the UPS reduce diesel generator reliance and maintain cooling during outages. Solid oxide fuel cells (SOFCs) can replace grid input, providing stable baseload power for high-efficiency cooling environments (see Figure 4). At the Vertiv Customer Experience Center, fuel cell systems have been successfully integrated with UPS to demonstrate this application in real-world operating conditions.
Figure 4. When integrated with fuel cells, the Vertiv™ Liebert® EXL S1 can maintain continuity during sudden power fluctuations and supports critical loads. Operators can connect these units to the grid using Vertiv Dynamic Grid Support Mode, supplying energy from the fuel cell and providing grid services like frequency regulation and peak shaving.
Alternative energy integration benefits on data center cooling
Grid stability
Alternative energy integration with other DERs helps reduce peak demand on utilities and absorbs local fluctuations, enhancing power reliability for data center cooling systems. According to the U.S. Department of Energy, integrating data center solar power with BESS can lower peak grid load by up to 20% in high-demand zones. When on-site generation exceeds cooling and IT needs, systems can export surplus power back to the grid, supporting grid frequency and voltage regulation during periods of instability.
Carbon reduction
Data centers can replace diesel generator usage with hydrogen fuel cells to reduce Scope 1 emissions. PEM fuel cells generate electricity through electrochemical conversion, emitting only water. Unlike diesel generators, these fuel cells can operate continuously with near-zero carbon impact when powered by hydrogen from alternative sources. Integrating data center solar or wind power to produce hydrogen via electrolysis at the generation and backup levels is more carbon-efficient (see Figure 5).
Figure 5. Phases 2 and 3 are short- to medium-term goals for data centers’ energy independence: reducing diesel generators’ starts from the microgrid facility and replacing them with PEM and SOFC fuel cells as backup and prime power sources, respectively.
Energy efficiency
Fuel cells and BESS offer higher conversion efficiency than traditional backup systems. While diesel generators typically operate at 30–35% efficiency, PEM and SOFC fuel cells can reach 50–60% efficiency under optimal conditions. Moreover, DERs allow operators to store off-peak or on-site alternative power and allocate it directly to data center cooling loads. This reduces unnecessary conversion losses and optimizes energy distribution across HPC data centers.
Cost-efficiency
Data center cooling consumes around 40% of a facility's energy, with AI workloads increasing this figure. Electricity prices have surged 17.2% in the U.S., 35.1% in Germany, and 10.5% in Japan since 2018, making thermal management a growing cost challenge. Alternative energy systems reduce generator runtime, fuel use, and maintenance needs, unlocking long-term cost efficiencies while supporting continuous operations.
Operational reliability
DERs can enhance uptime by enabling grid independence and reducing diesel generator starts. Microgrids with PV panels, fuel cells, and BESS can operate in island mode, delivering consistent power to cooling systems even during grid failures. UPS systems act as energy hubs in such setups, switching seamlessly between sources, managing frequency fluctuations, and delivering milliseconds-fast failover for critical data center cooling infrastructure (see Figure 6).
Figure 6. A dynamic or hybrid power energy ecosystem can reduce a data center’s vulnerability to an unstable grid by combining multiple energy sources and streamlining storage, distribution, and contingency mechanisms.
Activate your cooling advantage with dynamic power
Learn how your facility can stay ahead of demand with future-ready energy strategies. Visit Vertiv™ Dynamic Power today.
