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How Data Centers Can Drive Energy Innovation

Necessity, the proverb says, is the mother of invention. That indicates that the reason behind most innovations is that they fill a need. Many of us have a different, more modern way to explain that same observation: free markets work. People see a need, and they innovate to fill it, often crafting a new product or service.

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The most obvious example of this is, even now, helping to insulate Americans from higher energy prices. Yes, the price per gallon of fuel has jumped since February, but domestic price increases pale in comparison to the jump in Asia and Europe. That’s because entrepreneurs in the U.S. developed fracking to release and then recover tight oil and natural gas from shale formations.

The United States had been a net importer of petroleum products for decades when Texas oilman George P. Mitchell decided to experiment with fracking. He knew there were fossil fuels available in shale formations, but it took him many years of dogged experimentation to craft a process to extract those fuels.

Mitchell’s work paid off. “The wells began producing far more gas than ever before, and the costs dropped low enough to make shale gas drilling not just feasible, but profitable,” Authentic Texas magazine wrote. “The energy industry took notice. What had once been considered an impossible dream became a full-scale energy revolution.”

Keep in mind that this innovation was driven by necessity. By the late 1990s, other experts were predicting that the U.S. and the world had passed “peak oil” and would forever be energy deficient. Even fracking couldn’t save us, these experts insisted. “If we step back and acknowledge that the shale oil phenomenon will be over in a couple of years and that oil production is dropping in the rest of the world, then we have to expect that the remainder of the peak oil story will play out shortly,” retired CIA energy analyst Tom Whipple wrote in 2014. We are still awaiting that crash, more than a decade later.

>>>READ: AI can lower energy bills with data centers that power themselves

“As is well known, economic development can have major reactions and feedbacks,” Whipple added, having failed to take into account either the reaction to or feedback from fracking, which took the U.S. from being a net importer to a net exporter of hydrocarbons. Even with the oil we still need to import, three-quarters comes from the Western Hemisphere (principally Canada and Mexico), with less than 15% sourced from Saudi Arabia and Iraq.

The innovations that will shape the 21st century are coming from data centers.

Yes, it is fair to say these centers have become less popular as they’ve become more widespread. But because there are so many, and because they need so much energy to operate, datacenters are driving innovations that will improve energy efficiency. One way is through experiments with new building materials. 

“We see data centers as really important customers for entrepreneurs to commercialize technologies that we’ve been working on for a long time,” Dawn Lippert, the CEO of the non-profit Elemental Impact, told Axios recently. The company’s innovations include advanced cooling, energy storage, and low-carbon building materials.

Elemental will invest up to $5 million over the next two years to test technologies. “This initiative is coming at the most perfect time,” industry analyst Ryan Panchadsaram said, “because the priorities they have are literally the same priorities that you’re hearing from communities.”

At the same time that data centers are reducing their energy use, they are also preparing to use less water. Google recently announced plans to return more water to local watersheds than its data centers consume by 2030. It will also attempt to use reclaimed wastewater for cooling, and it will disclose each year how much water its facilities use.

>>>READ: Blocking Data Centers Won’t Make Electricity Cheaper

Expect more breakthroughs over time. 

Perhaps new data centers could be constructed with solar panels on their roofs? Doesn’t seem much of a technology challenge but it’s yet to catch on. Doing so would have dual benefit of insulating the roof from direct sunlight while also generating electricity that could be used to power and cool the computer components within. It won’t be enough to power the data center, but why not leverage every square inch of that roof? 

Or perhaps data centers could use geothermal technology to cool the facilities, such as the process used to air condition the visitor center at Brooklyn’s Botanical Garden. 

The one thing we can be sure about is that as needs arise, the free market will deliver innovations that solve problems.

The views and opinions expressed are those of the author’s and do not necessarily reflect the official policy or position of C3.

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