By Katherine Schwind & Olivier Pascal Malanda, Siemens Energy
This chapter is an excerpt from Greener Data: Volume Three, launched on Earth Day 2026. Featuring perspectives from 75+ sustainability leaders across the digital infrastructure ecosystem, the full book is available now on Amazon.
A Grid Under Pressure
Data centers are another emerging factor that must be considered as our aging energy systems transition to a clean energy future. While they do present new challenges to the electric system, data centers also possess unique characteristics that could position them as valuable assets in the electricity grid. This chapter shares strategies to enhance sustainability in a data center’s grid infrastructure, providing practical examples of ready-to-deploy solutions from three scopes of influence. When designed to align with decarbonization goals, data centers can surpass their traditional role as energy consumers to become active contributors to grid stability, efficiency, and sustainability, offering a technological bridge to our clean energy future.
Our energy grid is feeling pressure from numerous factors, as previously integral grid services are fundamentally reshaped in the clean energy transition. The grid ensures reliable delivery of electricity, balancing supply and demand in real time while maintaining stable voltage and frequency levels. Key drivers such as the rapid growth of variable renewable energy sources like wind and solar, the decline of traditional spinning assets used in fossil fuel-based electricity generation, and the electrification of sectors such as transportation and heating1 are affecting this balance. These factors are altering grid dynamics in several ways, including:
- Loss of inertia
- Increased supply variability from renewable energy
- Grid congestion
- Greater need for load flexibility
- Decentralization
- New load profiles – data centers and electrification of transport and industry
- Decarbonization targets
Today, the rapid growth of new data center loads is adding further challenges to the grid, including thermal and voltage violations, harmonic concerns, ramp rate issues, and fault ride-through issues.2 In response, new regulatory requirements for interconnections are emerging.3
Grid management requires new tools to reliably power our homes and businesses. By adopting advanced technologies and collaborating on solutions, data centers can help unlock the grid’s capacity to accommodate their new energy demand and accelerate decarbonization, while helping address the challenges of the energy transition. For anyone reading recent news headlines, data centers are perceived as a challenging new entrant to the energy system, but if planned and designed correctly, they could be a valuable new partner with significant resources and motivation to find solutions.
Enhanced Sustainability in Data Center Grid Connections
There are three meaningful levers to enhance sustainability benefits in the development and operations of electricity interconnection infrastructure for data centers.
- At the product level, reducing greenhouse gas emissions (GHG) – integrating improvements to reduce climate impacts in both the direct emissions throughout the operational lifetime and embodied GHG emissions.
- At the energy system level, scaling up benefits as a grid asset through technology selections – improving system capacity, mitigating interconnection risks, and supporting the resilience of local electricity infrastructure.
- As an innovation partner, supporting collaboration and developing innovative new solutions.
Decarbonizing Grid Technologies and Operations
The largest assets in data center energy connection are power transformers and switchgears. Their shared characteristics — long service lifetimes (30–50+ years) and large physical size — determine that the operational and raw material life cycle phases offer the greatest potential for sustainability enhancement. As such, improvements that reduce direct GHG emissions and improve efficiency in the use phase have substantial impacts as they are multiplied across a long operational lifetime. Additionally, utilizing low CO2 materials is another critical decarbonization lever, offering substantial emission reductions.
Eliminating F-gases in Switchgear Products
Traditionally, switchgear products were filled with SF6 as an insulating gas. The extremely high global warming impact of SF6, with 1kg SF6 equaling 24,300 kg CO2 equivalent emissions4, has stimulated the development of alternative products. Clean air switchgear products eliminate greenhouse gas emissions from the leakage of insulating gas throughout the long operational lifetime.
Comparing a single bay of a 145kV GIS over a 50-year operational lifetime, the clean air GIS eliminates >100 tons CO2eq. emissions from the leakage of SF6. This reduction in direct emissions is even greater when considering the complete GIS system (made up of multiple bays) the additional leakage during installation and maintenance.
Many hyperscalers have climate and Net Zero targets for direct emissions (Scope 1 and 2), but most procurement practices overlook the persistent and unavoidable emissions from F-gas leakage that will occur over the next 50 years.
Low Loss Transformers
The largest contributor of CO2 emissions in a power transformer is typically the electrical losses that occur during use phase. Transformers that are optimized for low losses can eliminate hundreds of tons of CO2e emissions by improving energy efficiency and thus reducing electricity consumption. The scale of impact is dependent on the CO2 intensity of the grids energy mix (renewable vs. fossil fuel sources), load profile, and more. Achieving higher efficiency requires more material, so we optimize the design for the operational needs to provide the most compact and efficient transformer.
Low Emission Materials
In the cradle-to-gate scope of a power transformer or switchgear, up to 90% of emissions occur from the raw material inputs, which present another decarbonization opportunity.
For transformers, there are low-emission alternatives available for all primary materials, including copper, steel, electrical steel, and insulation liquid. Up to 30% of embodied CO2e emissions in a large power transformer can be reduced by using low-CO2 materials for electrical steel, copper windings, and tank steel.1 Similar opportunities exist for aluminum in switchgear products.
At the substation level, emissions from raw materials in the civil infrastructure can also be reduced through use of low CO2 steel and cement. Analyzing a reference 110/20 kV AIS substation, the CO2e emissions in the cradle-to-gate scope are reduced by approximately 20% when integrating only low carbon cement in civil works and low carbon materials in the transformer.5
Data Centers as Grid Assets
Data centers have the potential to enhance stability and grid services, in support of their own growth and the clean energy transition. This section explores three technology applications that enhance grid availability, stability, and the integration of more renewable energy, all of which could be integrated with new data centers.
Dynamic Line Rating
Our first destination is the United States. Here, the application of Dynamic Line Rating (DLR) technology has enabled the use of real-time data to maximize the grid efficiency and use of existing infrastructure with an estimated gain of 25%. DLR technology can provide two distinct benefits that align with data center needs and sustainability goals, while benefiting the overall energy system:
- optimizing the capacity of existing infrastructure to enable new connections
- increasing renewable energy penetration and reducing curtailment
This technology has also been applied in Germany to manage congestion issues due to the high integration of wind energy from the north and transmission capacity constraints. This small but powerful technology could support the integration of new users, such as data centers, and the integration of more renewable energy, onto the existing grid infrastructure. This is an easy win for all stakeholders.
E-STATCOM
Our next destination is Germany. When one of Europe’s major transmission system operators (TSO), faced increasingly volatile voltage and frequency conditions due to the mix of fluctuating renewable generation, variable demand, and less inertia from conventional synchronous power generation, Siemens Energy and the TSO partnered on an innovative new solution to support dynamic grid stability. The world’s first E-STATCOM facility, a Static Var Compensator with supercapacitors, is capable of both voltage and frequency support, providing dynamic reactive power compensation within milliseconds.6 This technology smooths load profiles, reduces the need for emissions-intensive rapid generator ramping, and enhances the stability of the broader transmission system7 on the generation and demand side.
Large data centers, particularly those hosting AI training workloads, can create similar stress on the grid on the demand side. Sudden spikes in consumption from thousands of processors can cause abrupt voltage changes and reactive power swings at the point of connection. Applying E-STATCOM in this context would deliver the same stabilizing effect, shielding the grid from erratic load profiles while ensuring the data center operates with high uptime and consistent power quality. The operational benefits — improved equipment protection, reduced losses, and a better power factor — cascade into sustainability gains, such as lower fuel use by generators, decreased CO₂ emissions, and greater integration of renewable energy without curtailment. This approach not only ensures reliability for mission-critical computing but also strengthens the grid’s ability to transition to a cleaner, more resilient energy future.
Shannonbridge
Our final destination is Ireland. As a small nation with ambitious climate goals, Ireland’s progress is already tangible but comes with many of the challenges highlighted in the opening section. For the Shannonbridge project, we developed a technological solution that increases capacity and the integration of clean energy.
This is the world’s first application of a large-scale battery energy storage system (BESS) combined with synchronous condenser technology at a single grid connection. While the synchronous condenser provides short-circuit power, reactive power support, and inertia for frequency stability, the 160 MWh battery system can store enough surplus renewable energy to supply 9,500 households per day. This innovative grid stabilization system alleviates the need for renewable energy curtailment, thereby preventing CO₂ emissions from fossil fuel-based generation.
Data Centers as Innovation Partners for System Solutions
The examples above demonstrate the established innovation partnerships between TSOs and Siemens Energy that have addressed some of the most pressing technical challenges. With increasing public pressure on data centers related to their immense energy demands and potential impacts on our shared infrastructure, these collaborations offer examples of the untapped potential for creative partnerships between data centers and grid operators that support the growth of data centers, while benefiting our collective energy system.
Of course, change is only possible when all stakeholders are willing to work together to create effective solutions. With a well-established reputation as a trusted innovation partner to grid operators, this is where technology companies can help bridge the needs of data centers and grid operators. Sometimes this is the development of new technology, and other times, this is a technology-agnostic consulting challenge to look broadly at the system and all technical and non-technical tools, like policies or programs to incentivize grid services. Collaborative partnerships can catalyze change and enable more effective solutions realized at the system level.
The Greatest Sustainability Propositions Are in Collective Solutions
Within the electricity infrastructure of new data centers, there are numerous opportunities for decarbonization and enhancing sustainability. Data centers can unilaterally make technology choices in their interconnection infrastructure that reduce their CO2 footprint now and eliminate direct emissions well into the future. Collaboratively, data centers can work with technology experts and grid operators to develop creative solutions to ensure capacity while supporting grid stability. Given the size and scale of development, data centers are uniquely positioned to support enhanced grid services for the clean energy transition. Of course, it is not the sole responsibility of data centers to fund the energy grid. This simply identifies a ripe opportunity to leverage resources effectively for the collective benefit of all parties.
With data centers considering billion-dollar investments for complex off-grid projects to produce and manage their electricity themselves, there is clearly an immense willingness to think outside of the box to meet their energy needs. This ‘go-it-alone’ approach is not ideal for the data centers nor our energy grids and energy consumers. Data centers increase their risks by accepting sole responsibility for energy availability, complicating operating models, increasing costs with higher redundancy requirements, and decreasing future growth and flexibility. For the other rate payers on the grid, data centers present the first large electricity demand increase in many years. With aging grid infrastructure and general expansion needs for the energy transition, having more users on the system to distribute the cost of these investments can be beneficial for all ratepayers, but these connections must be planned in a manner that enhances efficiency and grid services with an effective mix of technologies and non-technical solutions. At the core, sustainability is about collective good and shared responsibility. Data centers are making big investments for their development off-grid or on-grid, the opportunity is to see how we can leverage those investments most effectively to benefit all.
RESOURCES
1. “Electricity Grids and Secure Energy Transitions,” IEA, 2023, https://www.iea.org/reports/electricity-grids-and-secure-energy-transitions
2. “Energy and AI,” IEA, 2025, https://www.iea.org/reports/energy-and-ai
3. Horger, Tim, “Large Load Additions, PJM CIFP Initial Proposal and Alternatives Considered,” PJM, 9/15/2025, https://www.pjm.com/-/media/DotCom/committees-groups/cifp-lla/2025/20250915/20250915-item-07—pjm-initial-proposal-and-alternatives-considered—pjm-presentation.pdf
“Data center activity exploded in Texas, spiking reliability risks: monitor,” Utility Dive, 2025, https://www.utilitydive.com/news/data-center-activity-has-exploded-in-ercot-spiking-grid-reliability-risk/752780/
4. “Global Warming Potential Values,” Greenhouse Gas Protocol. World Resources Institute & World Business Council for Sustainable Development, 2024, https://ghgprotocol.org/sites/default/files/2024-08/Global-Warming-Potential-Values%20%28August%202024%29.pdf
5. Emissions intensity and reduction achievements vary by rating and design. These numbers are calculated in alignment with EN15804 for a reference product and project.
6. “Germany’s bold move to reinvent grid stability,” Siemens Energy, 2025, https://www.siemens-energy.com/global/en/home/stories/grid-stability-first-e-statcom.html
7. “Energy and AI,” IEA, 2025, https://www.iea.org/reports/energy-and-ai
Author: Courtney Burrows
Courtney Burrows is the Executive Editor of Greener Data and Executive Vice President of Marketing and Sustainability at JSA, where she leads content strategy across PR, marketing, and media initiatives for the global digital infrastructure industry. With more than 20 years of experience — and over a decade dedicated to data centers — she curates expert insights focused on data center sustainability, innovation, and the evolving demands of an AI-driven world.
