Generators are like batteries. They convert energy between forms, but do not actually create it. Natural gas, coal, solar, wind, and nuclear are the energy sources. Given the importance of natural gas as a fuel source (in front of the meter, behind the meter, and off of the grid), I can see the CHR applying to gas as well as electricity.
For example, ERCOT is expecting the Provisional Conditional Load Resource to be a vehicle that allows data centers to connect to the grid before the transmission system is built out to serve the load without any violations. So a 1,000 MW data center may have a minimum load of 100 MW, which the grid can provide today without a violation. Everything between what the grid can provide and the 1,000 MW will be provided by off-grid generation.
Add to this all of the supposed "off-grid" data center developments, and I can't help but think that natural gas prices will soon their inflexibility shortly after electricity does.
Jeff, you're describing the fuel-side dynamics of CHR which is interesting and worth thinking about more. The CHR dynamics don't stop at the meter; they transmit upstream into whatever commodity is feeding the electron. Gas, grid power, diesel for backup gens; the structure changes but the compute economics don't. The PCLR example is a perfect illustration. Whether that 900 MW gap gets filled by grid electrons or on-site gas turbines, the data center's willingness to pay dominates the fuel cost at any historically observed price. You're right that gas is probably next- I'll think about doing some analysis on that!
Comment #2. I have spent my career in alternative energy/energy conservation/energy efficiency/sustainable energy/clean energy (plus load management, demand response and load flexibility).
I am now working in data center development. I am starting to imagine how everyone will respond when gas goes to $25/MMBTU. Folks may freak out a bit, but I don't think anything will change. $50? $75? Paging, Captain Ahab.
Comment #3. I have been wondering where we'll want to be in five years from now (in the energy field). I think we'll be heading towards the moment I foresaw as a kid. We'll be shaking our heads, wondering why we used something as valuable as energy on meaningless things. It'll probably be more like 15 years, but it won't be 150.
Comment #1. Which is the cause, and which is the correlate, I don't know. But I can imagine that the gas CHR and electricity CHR are two sides of the same coin and will track together. Electricity is usually seen to follow gas. So the rise in gas towards the CHR may proceed the rise in electricity prices towards the CHR. Either way, the potential for industrial, commercial, and residential economic impacts are real (and worrisome). Gas prices are way more zingy, too.
Generators are like batteries. They convert energy between forms, but do not actually create it. Natural gas, coal, solar, wind, and nuclear are the energy sources. Given the importance of natural gas as a fuel source (in front of the meter, behind the meter, and off of the grid), I can see the CHR applying to gas as well as electricity.
For example, ERCOT is expecting the Provisional Conditional Load Resource to be a vehicle that allows data centers to connect to the grid before the transmission system is built out to serve the load without any violations. So a 1,000 MW data center may have a minimum load of 100 MW, which the grid can provide today without a violation. Everything between what the grid can provide and the 1,000 MW will be provided by off-grid generation.
Add to this all of the supposed "off-grid" data center developments, and I can't help but think that natural gas prices will soon their inflexibility shortly after electricity does.
Jeff, you're describing the fuel-side dynamics of CHR which is interesting and worth thinking about more. The CHR dynamics don't stop at the meter; they transmit upstream into whatever commodity is feeding the electron. Gas, grid power, diesel for backup gens; the structure changes but the compute economics don't. The PCLR example is a perfect illustration. Whether that 900 MW gap gets filled by grid electrons or on-site gas turbines, the data center's willingness to pay dominates the fuel cost at any historically observed price. You're right that gas is probably next- I'll think about doing some analysis on that!
Comment #2. I have spent my career in alternative energy/energy conservation/energy efficiency/sustainable energy/clean energy (plus load management, demand response and load flexibility).
I am now working in data center development. I am starting to imagine how everyone will respond when gas goes to $25/MMBTU. Folks may freak out a bit, but I don't think anything will change. $50? $75? Paging, Captain Ahab.
Comment #3. I have been wondering where we'll want to be in five years from now (in the energy field). I think we'll be heading towards the moment I foresaw as a kid. We'll be shaking our heads, wondering why we used something as valuable as energy on meaningless things. It'll probably be more like 15 years, but it won't be 150.
Comment #1. Which is the cause, and which is the correlate, I don't know. But I can imagine that the gas CHR and electricity CHR are two sides of the same coin and will track together. Electricity is usually seen to follow gas. So the rise in gas towards the CHR may proceed the rise in electricity prices towards the CHR. Either way, the potential for industrial, commercial, and residential economic impacts are real (and worrisome). Gas prices are way more zingy, too.