On May 21, 2025, MassCEC, in partnership with Alliance for Climate Transition (ACT), hosted the event “Balancing Data Center Energy Use & Climate Goals.”
The event was designed to help Massachusetts stakeholders understand:
- The challenge of data center electric loads, and the current and emerging context of data centers in the state,
- Emerging technology solutions and opportunities to manage data center electric loads, and
- How to measure and mitigate the potential impacts of data centers on people and communities, and the policy levers to do so.
What transpired was a lively and rich forum for in-depth and technical learning from a variety of experts, as well as for sharing insights and exploring ideas. MassCEC and ACT will publish a summary report in the coming weeks, but I’d like to share some reflections in the meantime.
One key thread that we want to pull on is the opportunity we have to use data centers as a forcing function – an accelerator – for important areas of climate technology and grid innovation, and to contribute to Massachusetts’ role as a climate and clean energy leader.
Data Center Interest is Already Emerging in Massachusetts
The first lightbulb moment for many attendees (including me!) was that there are in fact data centers proposed in Massachusetts today. For instance, in National Grid’s service territory, there are seven current data centers and eight indications of interest. The eight awaiting interconnection to the electric grid total two gigawatts (GW) of capacity.
As one panelist also pointed out, given the development timeline for a data center, proposed data centers in utility queues today are likely ones that were developed several years ago. Additional data centers needed to support the rapid development of AI use cases, if they are coming to Massachusetts, are at least a few years away. Perhaps what we have right now are a few test cases to assess and develop a strategy for data centers before we see more come our way.
Understanding Community Impacts
At the event, we learned about the potential impact of data centers on communities.
For instance, researchers at the Harvard Chan School of Public Health and Harvard Data Science Initiative have developed air impact modeling linking the location of incremental increases in PM2.5, a particulate matter air pollutant, to the energy use of existing data centers.
Consultants working in other jurisdictions found that while existing data center development has not yet increased the costs included in typical consumer electric bills, this trend is unlikely to hold in the future, as data centers require incremental capacity on constrained grid systems.
In Massachusetts, where we are already facing a housing shortage, a data center represents magnitudes more electric load compared to a multi-family housing unit. To continue building healthy and equitable communities for residents, planning data centers in Massachusetts is a critical pillar to incorporate and get right.
At a Glance: Unique Data Center Challenges
- Scale: They are typically larger loads than we are used to seeing, representing a big impact on one area of the grid, all at once.
- Volatility: Their load profiles, or the electricity usage by time interval (hour, minute, second, sub-second), are quite different from other loads. Data center load profiles oftentimes look very volatile with the potential to drop off by tens of megawatts (MW) nearly instantaneously.
- Planning uncertainty: There tends to be – at least right now – more uncertainty in their size and timing of needed grid capacity, translating to inflated requests for capacity and challenging planning conditions.
- High willingness to pay: They likely have a very high willingness to pay for electricity–they have the potential to make a large margin per kWh consumed (the revenue generated per unit of compute is large, compared to how much they pay for the critical input of electricity).
- Small footprints: They have small physical footprints relative to their load, meaning that there is less potential for on-site renewables or storage to offset or smooth their grid impact (even if you cover a data center’s parcel with solar panels and batteries, it will offset only a small fraction of its energy use).
- Grid dependence: They probably need the grid–this may seem obvious, but if you consider alternatives such as on-site generation and storage, together with the size of the loads, it is nearly infeasible for them to fully create their own, reliable power system without, in the very least, relying on the grid for reliability and redundancy.
Reimagining Data Centers as Grid Innovation Labs
These attributes can be thought of as a unique opportunity for Massachusetts to use data centers to accelerate the clean energy transition.
If we work with the ecosystem of data center proponents as a willing test case to creatively solve the grid constraint and clean energy supply challenges they face, those solutions can be applied to other challenges across other parts of the energy transition. A few examples include enabling adoption of grid-enhancing technologies (GETs), advancing our capacity to do more sophisticated and proactive grid planning, and developing innovative electricity tariff structures.
Accelerating the Clean Energy Transition
Enabling GETs
Grid-enhancing technologies (GETs) are a suite of both emerging and commercialized technologies that help make the grid more efficient.
GETs use advanced materials and analytics to squeeze all the possible capacity out of existing grid assets and rights-of-way. GETs typically refer to hardware and software applied at the transmission-level; however, there are many similar applications for the distribution system that can also increase system efficiency in the same ways.
Data centers, with their high willingness to pay, need-for-speed in connecting to the grid, and desire for high reliability, may help to increase utility speed to adoption for GETs. GETs may provide the fastest solution to creating or freeing up capacity. Complementary regulation could address affordability impacts, ensuring that the costs of any grid infrastructure upgrades triggered by data centers are appropriately allocated to avoid undue electric rate increases to other ratepayers. Could data center projects essentially fund first use cases and pilots of GETs, de-risking and accelerating their use more broadly?
More sophisticated and proactive grid planning
Over the past year or so, the state has been navigating new processes to ensure that our grid will be ready to host the new electric loads coming from heat pumps, EVs, and other clean energy improvements. In parallel, the state is also exploring how to interconnect distributed energy resources (such as solar, batteries, and wind). Together, these steps will fuel our future clean economy.
Grid planning is complicated at best. Each input has its own uncertainty attached to it: how fast each neighborhood will adopt heat pumps, where EVs will be charging and when they’ll plug in and bump up load, where and how much solar and storage will attempt to site.
Data centers add another additional variable. To what extent can data centers be a catalyst in expanding grid planning capacity and tools, encouraging utilities to test and adopt new planning methods and tools to address the growing complexity of the job at hand?
Developing innovative electricity tariffs and flexible interconnection
Data centers, by the patterns and nature of their compute tasks, have volatile loads, with pockets of lower or non-utilization within their load profiles.
Historically, utilities treat load customers as needing consistent, reliable access to their full-needed electric capacity. This approach is how utilities tend to process a request for a new large customer, and how they plan the grid to serve that customer.
The concept of having planned interruptible load customers is relatively novel. It is also relatively novel for a utility to consider a different service “tier” for different load customers–ones that might pay differently or be treated differently in terms of their service needs. These novel structures could help utilities better serve the emerging landscape of different types of customers and help reflect the new range of needs across the growing diversity of loads and distributed energy resources (DERs). Could planning for and managing the needs of data centers encourage innovation around tariff structures, using a set of customers that have resources and an appetite for innovation?
What’s Next
Plenty of uncertainty exists around the scale and profile of future data center development in Massachusetts. Regardless of the outcome, we are currently well-positioned to strategically explore and plan for how we approach data centers and their impact on our communities and our electric system. If navigated well, we could leverage data centers to help us advance and accelerate our progress in achieving a stronger, cleaner, more affordable energy future.
MassCEC’s Net Zero Grid team works to advance innovation in grid technology, and in the ways in which we collaborate as grid stakeholders. Follow what we’re doing and share your thoughts.
We want to hear from:
- Grid technology innovators: we want to learn about your emerging grid solutions.
- Utilities: we want to learn more about the challenges you face and need solutions for.
- Grid stakeholders: we want to hear your ideas for areas where we can support new collaborative research and projects that build an equitable, clean energy future for all Massachusetts communities.
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Stay tuned: Watch updates to our Future Grid Event Series page to see the other events we have planned this year and to access the Data Center Event Summary Report when it is available.