Greetings from Mexico!
In this episode, we dive deep into a fascinating new metric called the Compute Heat Rate (CHR) and explore its potentially profound implications for the future of electricity prices and the power grid
.
With the explosive growth of AI, power grids are facing unprecedented demands. For example, Texas's ERCOT grid operator recently projected that load could max out at a staggering 319,650 megawatts by 2030, driven largely by data centers
. We are already seeing the impact in markets like PJM, where data load growth has blown up capacity revenues to the tune of an estimated $23 billion in costs over the next three years
.
But what happens to the actual energy prices? That is what the CHR attempts to answer by asking: at what price would data centers elect NOT to consume power?
Introduced by industry veteran Hans Royal, the CHR measures the maximum electricity price a data center operator can rationally pay before their computing tasks become uneconomic
. Because AI creates enormous economic value, these data centers are incredibly inflexible and willing to pay massive premiums for power
. While traditional large loads like steel or aluminum producers will typically shut down when prices hit $40 to $120 per megawatt hour
, Royal estimates that AI data centers have a blended CHR of approximately 6,350permegawatthour
.Forhighlycritical,just−in−timeAIinferenceservices,theymightnotcurtailpoweruntilpriceshitover∗∗53,000 per megawatt hour**!
Watch to learn more about:
The massive gap between AI load forecasts and grid realities
.
Why regulators are demanding "Flex Mosaic" and load-shifting capabilities from data centers
.
The difference between Large Language Model (LLM) training loads and peaky inference loads
.
How the incredible power density of new tech—like the Nvidia Rubin architecture, where a fridge-sized box uses the power of 65 households—could price regular consumers out of the market
.
If these data centers refuse to curtail power at any normal wholesale price, we could see massive localized demand supply imbalances
. Watch now to understand the new metric tracking this emerging grid crisis

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🎙️ About Energy Future: Powering Tomorrow’s Cleaner World

Hosted by Peter Kelly-Detwiler, Energy Future explores the trends, technologies, and policies driving the global clean-energy transition — from the U.S. grid and renewable markets to advanced nuclear, fusion, and EV innovation.

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Is it now AI's world, and we just live—and pay for electricity—in it? The AI revolution requires a staggering amount of electricity, and our power grid is struggling to keep up with the astonishingly rapid growth of data centers.

In this video, we dive into the unprecedented crisis facing grid operators like PJM Interconnection. With some regions seeing data-related energy loads jump from just 600 megawatts to 11,000 megawatts, grid operators are facing challenges never seen before in power markets.

Key topics covered in this video:

The Data Center Explosion: How utilities at ground zero, like Dominion in Virginia, are fielding up to 70,000 megawatts of large load interconnection requests—nearly equal to or exceeding the load they currently serve.

PJM’s "Hail Mary" Solution: A breakdown of PJM’s proposed parallel auction, a one-off bilateral contracting process aiming to secure 14,900 megawatts of new capacity by matching large loads with supply owners.

Supply Chain Roadblocks: Why finding enough equipment is a major hurdle, with grid-scale gas turbines essentially sold out globally through 2029.

A Broken Market: How the massive wealth of tech giants is warping energy economics. With data centers valuing early grid connection at up to $7 billion per gigawatt, capital is practically guaranteed to abandon the standard, price-capped public power markets in favor of lucrative, uncapped bilateral tech contracts.

As energy developers chase higher returns to power the AI boom, existing resources are being locked out, and everyday consumers might face the collateral impacts. Watch to understand why fixing the grid for AI is a nearly impossible puzzle.

Support the show

🎙️ About Energy Future: Powering Tomorrow’s Cleaner World

Hosted by Peter Kelly-Detwiler, Energy Future explores the trends, technologies, and policies driving the global clean-energy transition — from the U.S. grid and renewable markets to advanced nuclear, fusion, and EV innovation.

💡 Stay Connected
Subscribe wherever you listen — including Spotify, Apple Podcasts, Amazon Music, and YouTube.

🌎 Learn More
Visit peterkellydetwiler.com
for weekly market insights, in-depth articles, and energy analysis.

In this week's energy market update, we explore the explosive growth of the energy storage sector, now widely recognized as the "Swiss Army knife" of the modern power grid. Ever since the Aliso Canyon gas leak in 2016 kickstarted utility-scale battery deployment, plunging lithium-ion costs—driven largely by the EV industry—have completely transformed how we balance the system.

We break down the latest US Energy Storage Monitor report from Wood Mackenzie and American Clean Power, which reveals that an incredible 18.9 gigawatts (51 GWh) of storage was installed in 2025, marking a massive 52% year-over-year increase. Since 2019, the US has added over 50 gigawatts of storage to the grid.

For energy professionals tracking resource adequacy and grid integration, this video covers several critical trends:

Data Center Interconnection: How data centers are increasingly relying on on-site batteries to provision loads during system peaks, effectively bypassing congested grid constraints and potentially saving billions in fees.

Solar Hybridization & Transmission: Why nearly half of all utility-scale solar projects are now paired with 3-hour storage to rescue low-value midday power and sell it during high-priced evening peaks. We also explore the concept of "storage as transmission" to ease regional grid congestion.

Renewable Energy Droughts: As variable renewables flood the system, utility planners must now prepare for multi-day weather events—like atmospheric rivers or snowstorms—that can drastically cut solar or wind output, requiring much longer-duration backup.

Beyond Lithium-Ion: We look at the commercial emergence of alternative long-duration technologies, including compressed air projects from Hydrostor, liquid CO2 systems from Energy Dome, and liquid air turbines from Highview Power.

The Form Energy Disruption: Finally, we discuss how Form Energy's 100-hour iron-air batteries could drastically alter Wood Mackenzie's future forecasts. With recent massive deals announced alongside Xcel Energy, Google, and Crusoe, just two projects account for 80% of last year's total US storage additions in terms of gigawatt-hours.

Join us as we explore what the next 500 gigawatt-hours of projected energy storage will look like between now and 2031

Support the show

🎙️ About Energy Future: Powering Tomorrow’s Cleaner World

Hosted by Peter Kelly-Detwiler, Energy Future explores the trends, technologies, and policies driving the global clean-energy transition — from the U.S. grid and renewable markets to advanced nuclear, fusion, and EV innovation.

💡 Stay Connected
Subscribe wherever you listen — including Spotify, Apple Podcasts, Amazon Music, and YouTube.

🌎 Learn More
Visit peterkellydetwiler.com
for weekly market insights, in-depth articles, and energy analysis.