Data center developers, including hyperscalers, are responding to the rapid expansion of artificial intelligence (AI) and migration of data into the cloud by expediting and scaling up the construction of data centers in the U.S., especially in Texas.

This growth brings with it challenges for the developers and their partners, including how to reliably power these projects, and the scale of this challenge will only grow as new generations of microchips are rolled out. More companies are looking at off-grid energy solutions at their data center sites to avoid or minimize issues associated with grid power. Hyperscalers also face practical issues, including access to water and supply chain pressures.

This report explores five key dynamics affecting the rollout of off-grid data centers in the U.S., and considers what this means for hyperscalers, energy project developers, and financiers. The focus is predominantly on Texas because of its deregulated retail electricity market, and because its behind-the-meter market is more advanced than most of the rest of the U.S. However, many of the trends related to energy generation, community reactions, and infrastructure investments are relevant in other markets.

This report includes insights from external data center and energy experts, as well as the legal professionals from Troutman Pepper Locke’s energy and real estate teams.

Click here to read the report.

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