From Backup to Backbone: How Battery Energy Storage Systems Redefine Data Centre Energy Independence

The scale of the challenge

If you’ve stood beneath the neon storm of Tokyo’s Shibuya crossing, surrounded by floor-to-ceiling LED ads, illuminated vending machines on every corner, and entire buildings wrapped in light, you’ve witnessed one of the world’s most electricity-intensive urban spectacles. Yet, according to the International Energy Agency (IEA), global data centres will consume more electricity than the entire nation of Japan by 2030, doubling current demand to 945 terawatt-hours. And in the United States alone, data centres are projected to account for nearly 50% of new electricity demand growth between now and the end of the decade.

Data centres aren’t optional infrastructure, they’re critical to economic competitiveness, national security, and technological advancement. Unfortunately, grid capacity isn’t scaling to meet this urgent demand and remains a major bottleneck with Ofgem reporting that UK companies currently face wait times of up to 15 years to connect to the local power grid. And, when they do eventually connect, they can have a drastic impact on household bills. A recent Bloomberg analysis revealed that in US regions with significant data centre activity, electricity now costs 267% more for a single month than it did five years ago.

The behind-the-meter imperative

Behind-the-meter (BTM) solutions offer a way to scale compute capacity while avoiding the grid strain and cost burden that data centres typically impose. These systems, powered by energy including gas and renewables, generate power onsite allowing data centres to operate autonomously without relying on the local grid. But with small modular reactors (SMRs) offline until 2030 at the earliest, the push to phase out gas intensifying, and renewable generation intermittent by nature, battery energy storage systems (BESS) have become the critical solution. They’re no longer just backup power. They’re the backbone of energy independence.

Comparing behind-the-meter technologies

The aim of BTM solutions is to allow data centres to generate power onsite, reducing their dependence on the local energy grid. But there’s a wrong way to do this. Some proposals involve diverting power from existing plants to exclusively serve data centres, effectively pulling that generation capacity off the public grid. This creates real problems: overall supply tightens, electricity prices rise for everyone else, and communities lose access to infrastructure they may have helped finance. Simply reallocating existing assets doesn’t solve the energy challenge, it just shifts the burden elsewhere. The right approach is building new generation capacity alongside data centres to expand total energy supply, not cannibalise what’s already there.

Gas: Gas-fired generation offers proven technology with established infrastructure. Projects like OpenAI’s Stargate initiative recently announced five new data centres across the US, with a planned capacity of 7 GW to be delivered by BTM gas turbines. However, gas has its problems. Not only do we as a society need to reduce our gas reliance, according to the IEA, turbine deliveries for new gas-fired power plants face lead times of several years, potentially delaying commission beyond 2030.

Geothermal: Geothermal offers clean, consistent baseload power, and the potential is significant: Rhodium Group estimates enhanced geothermal could meet up to 64% of forecasted electricity demand growth at U.S. hyperscale facilities. The challenge is that geothermal isn’t geographically viable everywhere, limiting where it can be deployed as a solution.

Small Modular Reactors (SMRs): SMRs represent the ideal long-term solution for clean, consistent baseload power. The problem is that commercial development remains in its infancy globally, with licensing and regulatory hurdles pushing deployment timelines to 2030 at the earliest. SMRs are the future, but they’re not available now.

Renewables with Battery Energy Storage Systems (BESS): Renewables align with sustainability targets and major tech companies are investing heavily. Google’s $20 billion partnership with Intersect Power aims to build gigawatt-scale renewable campuses. But renewables are intermittent, which is precisely where advanced BESS technology comes in. Companies like Nyobolt are engineering ultra-fast charging systems specifically for industrial-scale energy storage, transforming intermittent renewables into reliable, continuous power that allows for true energy independence.

The path forward

The energy challenge facing data centres is immediate. With grid interconnection delays stretching over a decade and electricity demand from AI set to double by 2030, the industry can’t afford to wait for future solutions. SMRs promise clean baseload power but won’t arrive until 2030. Gas works today but contradicts decarbonisation commitments. Geothermal is geographically limited.

Co-locating BESS with renewable generation offers a practical solution to the intermittency problem that has historically limited wind and solar deployment for always-on infrastructure. When the sun sets and wind dies down, batteries keep systems running. When renewable generation exceeds demand, batteries store the surplus energy. This combination addresses both the immediate capacity crisis and long-term sustainability requirements. What began as backup infrastructure has evolved into primary infrastructure. For data centres that need to deploy capacity now while meeting environmental targets, renewables paired with BESS provides a proven, scalable option available today.