The need for rapid deployment stems from unprecedented expansion in hyperscale and colocation capacity. Research firm DC Byte reports that operators added 12 GW of new capacity across the region in 2024. Thirty-five projects exceeding 1 GW were announced last year, compared with only three in 2023. Another 15 projects slightly below that threshold began construction during the same period.
Many of these facilities are being located in non-traditional technology hubs such as North Dakota, West Texas, Indiana, Pennsylvania, Kentucky, the Kansas City metropolitan area, West Virginia, North Carolina and Alberta, Canada. Developers are often drawn to those areas by available land, favorable regulations and, in some cases, stranded energy resources.
In North Dakota, Applied Digital is repurposing power from an underutilized wind farm to run high-performance computing workloads. In Wonder Valley, Alberta, planners intend to rely on on-site natural gas generation to support an 8-GW data center, with the first 1.5 GW scheduled to be operational by 2027.
Industry executives refer to the approach as “bring your own power” (BYOP). Instead of waiting for a utility connection that may take three to five years—or longer when new transmission is required—developers negotiate local fuel supply contracts and install modular generator units that can be commissioned in stages. Batteries are added to manage load fluctuations and maintain power quality.
While diesel engines have traditionally provided backup power, natural gas is gaining favor for continuous operation because of lower emissions and easier fuel logistics. According to the U.S. Energy Information Administration, natural gas plants emit roughly 45 percent less carbon dioxide per kilowatt-hour than coal and significantly fewer particulates than diesel combustion. Gas-fired units can also run for extended periods without the refueling constraints associated with diesel storage.
Still, the practice raises questions about long-term sustainability and grid integration. Utilities must plan for the possibility that large clusters of self-powered data centers may eventually seek grid interconnection for redundancy or market participation. Policy discussions are also under way at the state level to determine how on-site generation should be regulated and whether incentives for renewable power should be extended to these installations.
For now, however, developers appear focused on securing immediate capacity. The Utah project’s initial phase is designed to scale quickly, with generators and batteries shipped in standardized enclosures for rapid assembly. Waste heat recovery systems will feed absorption chillers and other thermal management equipment, reducing reliance on mechanical cooling and improving overall site efficiency.
Similar strategies are emerging elsewhere. In West Texas, several proposals call for clusters of 50 MW to 100 MW gas turbines installed adjacent to new data halls, supported by lithium-ion battery banks for short-duration smoothing. In Pennsylvania and Kentucky, developers are exploring combined heat and power (CHP) configurations that supply both electricity and process steam to adjacent industrial partners, creating additional revenue streams.
Market analysts expect the BYOP model to persist as long as AI-driven demand outpaces the ability of utilities to deliver new capacity. The timing of multiple power plant retirements, coupled with permitting delays for renewable projects and transmission lines, has widened the gap between data center growth and available grid resources. Gas generators, which can be ordered, shipped and installed within months, offer a near-term solution despite longer-term decarbonization goals.
As the Utah campus and other projects advance, stakeholders will watch closely to evaluate performance, economics and environmental impact. For developers racing to bring AI compute online, the immediate priority remains clear: secure reliable power now, and adapt to evolving regulatory and market conditions later.
Crédito da imagem: Caterpillar
