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Pacific Northwest data center boom could imperil power supply within 5 years

By Lulu Ramadan, The Seattle Times
Published: July 10, 2024, 7:52am

SEATTLE — The Pacific Northwest’s power grid could be pushed beyond its limits in just five years by the staggering electricity demands of the booming data center industry, regional power planners recently reported.

A forecast by the Northwest Power and Conservation Council highlights a looming conflict between an increasingly digital world and utilities’ capacity to meet surging power demand. The forecast cautioned that data centers could consume as much as 4,000 average megawatts of electricity by 2029 — enough to power the entire city of Seattle five times over.

In that scenario, the region would need to find more sources of power to avoid a shortfall. Otherwise, the Northwest will struggle to keep lights on while also phasing out fossil fuels and meeting environmental mandates to protect salmon, according to a council report presented Tuesday in Portland.

“It’s big and it’s uncertain,” said Jennifer Light, the council’s director of power planning. “But we’re kind of prepared to think through strategies on how to figure this out.”

Data centers, the backbone of the modern internet, are warehouses of humming servers that store information relied upon by nearly every online user, and are becoming increasingly important as use of artificial intelligence grows. The International Energy Agency predicts data center power demand worldwide will double by 2026, in large part due to AI.

The data center industry has particularly boomed in Washington and Oregon, which offer cheap hydroelectric power for an industry that requires steady, round-the-clock power. Washington’s data centers began popping up in the mid-2000s, when tech companies began building massive warehouses in Central Washington’s agricultural counties with the help of tax incentives designed to bring tech jobs to rural areas.

Data centers draw vast amounts of power to cool computer servers that run continuously to feed the demand for search, video streaming and audio.

Created after the Northwest Power Act of 1980, the council is an interstate agency charged with developing a power plan for Washington, Oregon, Idaho and parts of Montana. The Northwest is rich in hydropower from a network of dams in the Columbia Basin that bring ample electricity to the region but threaten salmon populations on which Indigenous groups depend.

The council ran a series of scenarios to test how the region’s power grid would react to growth of data centers. In scenarios based on low-end and average growth in the data center industry, coupled with plans to bring more renewable energy online and increase energy efficiency, the region would have enough power to meet the needs of data centers by 2029.

One reason the region can accommodate possible growth: Some coal plants owned by Pacific Northwest utilities have been converted to use natural gas, instead of being retired entirely. That gave the region more power-generating capacity. It’s not clear how that might affect Washington down the road, when a mandate to phase out fossil fuels by 2045 takes full effect.

But if the high-end data center prediction becomes a reality, the region faces serious risks.

That level of power demand from data centers would require “an unprecedented level of coordination and pace of development to overcome bottlenecks” in transmission and distribution of power, according to a council report.

It wouldn’t mean widespread blackouts, although outages are a possibility, the council reports. But such a significant shortfall in power could trigger emergency measures, such as frequent purchases of expensive power from other markets or statewide conservation requirements.

It wouldn’t be impossible to accommodate the growth of data centers, Light said. But it would require more power and more transmission lines, both costly and time-consuming efforts.

The region has brought online some solar and wind power, but those sources are weather-dependent and intermittent. And the added renewables haven’t been able to keep pace with the climbing power demands, according to a recent report from the Pacific Northwest Utilities Conference Committee, which represents public and private utilities serving millions of customers.

The demands of data centers only exacerbate the need for electricity as the region weans its vehicles, appliances and industries off oil and natural gas. The need for reliable power also becomes more important as extreme weather events become more common.

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Meanwhile, past forecasts have underestimated the surge in data center power use, Light said.

Even Tuesday’s presentation highlighted two dramatically different scenarios. The council said that neither scenario was necessarily more likely, but that it hoped to plan for a range of possibilities.

The lower scenario drew on past trends in the region and public announcements about data centers opening, said Tomás Morrissey, the council’s senior power analyst.

The higher scenario aligns more closely with descriptions from public and private utilities, the entities fielding requests from data centers seeking to site in the Northwest. (The forecasts also captured potential growth in microchip manufacturing, but almost all the growth is predicted to come from data centers.)

How the region will accommodate such significant growth is something that energy planners will have to address in the coming years.

“I think it’s weighing fairly heavily” on utilities, Morrissey said. “It’s a question we’re gonna have to grapple with a lot in the next power plan.”

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