The Insatiable Energy Demands of Data Centers Could Increase Fossil Fuel Emissions in California

Capital & Main

Surging electricity demand from data centers across the U.S. is outpacing the supply of new clean energy sources, helping to sustain the fossil fuel industry. It’s a dynamic at play in California, where renewable energy is limited and expensive while power from existing natural gas plants is available and cheap.

Prices for renewable energy in long-term purchasing contracts are “some of the highest that I’ve seen in the last 20 years,” said Monica Padilla, CEO of Silicon Valley Clean Energy. Her organization, a community choice aggregator that buys renewable electricity for customers, serves three data centers.

Over the last year, “We started seeing these huge load growth” forecasts from the state, Padilla said. Meanwhile, prices per megawatt for solar, wind, geothermal and battery storage have doubled or tripled since 2018. “We can’t do it just with renewables right now. They’re too expensive.”

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