One sunny afternoon in April, a big power outage happened across the Iberian Peninsula. Millions of people lost electricity. Shops closed, travelers got stuck, and phones and internet stopped working. Experts are still checking what caused it. This event made people talk about which energy sources are best as artificial intelligence (AI) and data centers grow fast.
Renewable energy is very important. It is getting better at supporting AI and data centers because of new energy storage, smarter power grids, and ways to use energy more efficiently. But for now, we still need to use clean energy together with natural gas to keep power reliable. In the future, green energy and nuclear power will be the main sources, but right now, the best way is to use both together.
Jim Spencer, the CEO of Exus Renewables North America, said that thanks to more renewable energy and big batteries in the U.S., plus new technology to improve the grid, the power system is stronger than it was five years ago. He added that renewables are key to powering AI data centers, meeting growing energy needs, lowering costs, and driving new economic growth.
Some politicians blame different energy sources for past power outages. Supporters of traditional fuels say wind and solar only work when the weather is good, so they need backup power from batteries or natural gas, which can cost more.
During the Iberian Peninsula blackout, renewables supplied 70% of the energy. But the outage was not caused by wind or solar power. Instead, the problem was the power grid could not quickly fix sudden issues. Two big power losses happened at stations in southwestern Spain, which caused a sudden drop in power. This affected the grid’s voltage and frequency—the important signals that keep the power system stable.
Spencer says green energy is the cheapest and fastest way to add power to the grid. It works well with help from batteries, demand response, and quick-start natural gas power plants. Battery prices have dropped more than 85% since 2010, which makes the system more reliable. Renewable energy sources can be placed close to modular data centers.
Ron Schoff, director of research at EPRI, said during a virtual event, “We need to understand when the technology is ready and how much it costs, especially as data centers start using power.” He added that data center power needs will grow a lot in the next two to three years, so the system must handle fast changes in electricity supply and demand.
Better Wind Turbines and Solar Panels
Wind Harvest says its turbines are better and can work in tough weather. Their turbines keep running during storms or when the grid is stressed, helping prevent blackouts and keeping the system stable.
Their wind turbines are different because they are vertical and closer to the ground, unlike usual tall turbines that spin horizontally. They can catch wind from any direction and work well in gusty, uneven wind near the ground where other turbines don’t do well.
Kevin Wolf, CEO of Wind Harvest, said, “No one has made a turbine that works well in strong, choppy winds near the ground until now. Our turbines can be used in wind farms and help power AI data centers in places like California. We can use wind energy when it’s windy and when it’s calm, opening new possibilities.”
Right now, renewable energy needs to be combined with other fuels to meet the big power needs of AI data centers. These centers need a lot of power and can’t afford to lose electricity, so they need good and cheap battery backup or fast natural gas power.
AI is growing fast, but many clean energy technologies like long-lasting storage, clean hydrogen, and small nuclear reactors are not ready yet. So, natural gas and big nuclear plants still run all the time to power AI data centers. The Trump Administration supports coal for this, but coal is expensive, slow to start, and not very flexible.
Cornelius Shields, founder of Kore Infrastructure, said, “With huge power needs from AI worldwide, we need to use all types of energy. We should include renewable energy that is always available, can be set up nearby, and can grow in size. Energy from organic waste is one option we haven’t fully used yet.”
The utility industry’s main goal is to keep power reliable
The utility sector wants to give people reliable electricity at the lowest cost. But coal doesn’t fit this goal because it is dirtier and more expensive than renewable energy or natural gas. Most coal power plants in the U.S. are very old, and fixing them is too costly. Utilities plan for the long term, thinking about costs over 20 to 40 years, but coal is becoming less popular in the market.
Energy use is expected to grow a lot in the next 5 to 10 years because of efforts to reduce carbon emissions, use more electricity, and the rise of AI and data centers. To handle this, we need new grid technologies to expand the network’s ability to supply more electricity. At the same time, we should retire old coal, nuclear, and natural gas plants that have been working for over 40 years. Renewables are growing fast; last year, solar and battery storage made up 81% of new electric capacity added.
Big AI companies like Google, Microsoft, and Meta want to run completely on renewable energy. They are doing this because investors and rules push them to cut emissions and be greener. AI data centers can be placed in areas with lots of renewable energy, which helps reduce pressure on the main grid.
Right now, about 260,000 megawatts of power are ready to join the U.S. grid — more than double what current power plants produce. According to the Lawrence Berkeley National Lab, 95% of this new power comes from solar, wind, and battery storage.
Jason Huang, CEO of TS Conductor, said, “The power grid is the key problem. We don’t have enough capacity and there are many bottlenecks. We have a new advanced conductor technology ready to be used widely to fix this and make power more affordable.”
The blackout in the Iberian Peninsula is not a rare event. It happened because of weak regulations, old grid technology, and extreme weather. More electricity demand will make these problems bigger but also creates chances to improve. We need more research and new grid and energy technologies to make sure clean energy can always meet the needs of data centers in real time.
Published: 2nd June 2025
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