The AI boom has led to a chip shortage, but there’s an even bigger infrastructure problem.
The growth of data centers is putting new stress on electrical grids, utilities and energy markets. Training and running cutting-edge AI models requires huge computing power, so electricity needs to be abundant and reliable. The race to grow their facilities has made practical energy storage solutions all the more urgent for technology companies.
One potential answer could already be sitting inside electric vehicles.
Car makers and energy firms are looking at ways to tap the batteries of electric vehicles to help power data centers, utilities and other big users of electricity. Some batteries could be connected to the grid while still in vehicles. Others could be recovered from retired vehicles and used as stationary energy storage systems.
The idea offers a nice second life for batteries which are no longer good enough for the demanding performance standards of an electric car but still retain a good amount of storage capacity.
Data Centers Need More Than Just More Electricity
The energy challenge for data centers is not simply about generating more power. These facilities also need to cope with rapid changes in demand, to continue operating during disruptions and to protect sensitive equipment from variations in the electricity supply.
AI workloads can be quite demanding. Training a large model might require thousands of processors working in parallel and producing big, fast-changing, and significant electrical loads.
“According to the International Energy Agency, worldwide demand for data center electricity is projected to more than double by 2030 to about 945 terawatt-hours,” That growth is expected to be driven most importantly by AI-optimized data centers.
Battery systems can help with these situations by storing electricity when it is available and then releasing it when demand is higher. They can also serve as a source of backup power, reduce peak demand, and help facilities integrate renewable energy sources that are dependent on the weather.
That mix of functions is making batteries increasingly valuable to data center operators.
A Second Life for EV Batteries
Electric vehicle batteries age and the capacity slowly diminishes. Ultimately, a battery may not be able to deliver the driving range, charging performance or power delivery that vehicle owners expect.
fThat does not necessarily mean the battery is useless.
Stationary storage is generally a lot less onerous than automotive use. A data-center battery doesn’t need to propel a car, endure constant road vibration, or deliver hundreds of miles of range. It needs to be able to safely store electricity and release it on a controlled schedule.
To put the opportunity into context, Ali Mehrizi-Sani, director of the Power and Energy Center at Virginia Tech, said, “Repurposed EV batteries provide a potentially lower-cost and already-available option for deploying energy storage.
For data centers retired battery clusters could be assembled into larger storage installations. These systems could store energy during low demand and discharge it during peak hours. They could also react to abrupt load variations, reducing the load on the local grid.
That would extend the economic life of the batteries, while delaying the energy-intensive process of recycling their constituent materials.
Energy Storage is the New Thing for Car Makers
This idea is starting to attract serious commercial interest.
Ford Motor Co. intends to deploy electric vehicle batteries in energy storage systems for utilities and data centers. General Motors has also announced plans to develop new battery technologies and expanded vehicle-to-grid capabilities.
The moves suggest automakers are starting to think of batteries as infrastructure assets, not as things that have value only during the life of a vehicle.
The move could be a new source of revenue for manufacturers, and help them handle growing inventories of used battery packs. It could also encourage automakers to design future batteries with an eye toward repair, reuse, monitoring and eventual stationary deployment.
In the future, the resale value of an electric vehicle may be influenced not only by the condition of the car but also by the stationary-storage value of its battery.
Another Possibility: Vehicle-to-Grid Technology
The electricity system would not require all vehicles to have their batteries removed.
Bidirectional charging allows compatible electric vehicles to both receive electricity and send it back to a building or the grid. Hence a large fleet of parked cars could be a distributed energy resource.
Vehicles that take part could, with the owner’s permission, charge when demand is low and discharge a limited amount of electricity when the grid is under stress. In return, owners could potentially receive credits or reduced electricity rates.
V2G solutions may not be a good fit for data centers to replace dedicated backup infrastructure. But they can be part of a wider network of flexible energy resources that helps utilities manage periods of extraordinary demand.
The upside of this approach will depend on battery warranties, the availability of charging infrastructure, compensation models and clear rules on how often vehicles can be used to support the grid.
Safety & Battery Health are still paramount
But the promise of second life batteries is not without its significant technical hurdles.
Used battery packs don’t age evenly. Their condition is affected by temperature exposure, charging history, driving behavior, manufacturing variations and mechanical damage. Operators need to accurately determine the remaining capacity and safety profile of a battery before it can be placed into stationary service.
Battery management systems will be needed. These systems monitor temperature, voltage, charge levels and degradation on individual cells and modules. If the installation is stationary and has batteries from several different vehicles, the software required might be more sophisticated to account for the differences in age and performance of the batteries.
Another issue is fire protection. Storage systems that create unacceptable operational risk cannot be tolerated by data centers. Facilities will require adequate thermal management, physical separation, emergency procedures and adherence to changing safety standards.
Standardization may be equally important. Car makers have different battery formats, chemistries, software systems and electrical architectures. Until the industry develops more consistent designs and testing protocols, it may still be too expensive to convert those packs into reliable storage products.
Lithium-Ion Is Not the Final Answer
Currently, most of the electric vehicles use lithium-ion batteries because of their high energy density and good cycling performance. These characteristics also make them attractive for data centers, where physical space and long-term reliability are concerns.
However, lithium-ion technology is reaching practical limits in terms of energy density, material requirements, and thermal management. Researchers and manufacturers are therefore looking at alternatives, including sodium-ion batteries.
“Sodium-ion systems typically store less energy for their weight, making them less appealing for vehicles where range is important.” Weight is not an issue with stationary storage. Sodium is also more abundant than lithium, which may make sodium-ion batteries an attractive option for large energy installations in the future.
The future data center may use several storage technologies simultaneously. New batteries could provide high performance backup power, second-life EV batteries could be used for peak demand, and other systems could make longer duration storage possible.
A circular energy economy is coming into being.
Reusing electric vehicle batteries doesn’t solve all the data center energy problems. We will still need more power generation, stronger transmission networks, faster grid connection and more efficient computing systems.
But second-life batteries could solve multiple problems simultaneously.
They could provide data centers with flexible energy storage. They could assist utilities in managing demand. They might find a productive use for the old battery packs automakers have. They could also postpone recycling until a larger share of a battery’s economic value has been recovered.
The broader significance is difficult to deny. The battery that had once moved a person could later stabilize the power supply to an AI facility, a factory or a local power grid.
That switch would be more than smart repurposing. That would herald the start of a circular energy economy where batteries are long-term assets with several distinct working lives.
As data center electricity needs grow rapidly, the batteries now being deployed for transportation could be an important part of the infrastructure required to support the digital economy.
