Energy Institute at Haas

Data centers and large electricity loads are power hungry, raising concerns about higher electricity costs, increased emissions, and reliability risks. We show that co-locating solar+storage systems with underutilized natural gas plants offers a practical, near-term pathway for reliable, low-cost industrial power. Using eight years of hourly weather data, we co-optimize load and hybrid solar+storage+gas configurations at 68 existing plants near data center developments, meeting over 95% of demand with solar+storage. Across these sites, levelized costs range from $60-138/MWh, competitive with data centers’ recent contract prices for 24/7 clean power. Conflict analysis indicates minimal overlap between solar+storage backup needs and grid stress across most regions of the United States today, allowing gas units to provide dual roles: facilitating large load integration while supporting grid reliability. By optimizing existing infrastructure, this approach offers a scalable pathway to serve large loads, though realizing these benefits will require careful coordination amongst stakeholders.