Key insights
- Several large data centers and crypto facilities in Texas have failed crucial reliability tests, increasing the risk of power outages during peak summer demand. These facilities, driven by AI and crypto mining, can abruptly disconnect from the grid during disturbances, potentially destabilizing it. This situation highlights a growing strain on power infrastructure due to the unpredictable nature of these large energy consumers, posing a risk to grid stability and broader electricity supply.
By Tim McLaughlin
June 5 (Reuters) - Several large data centers and crypto facilities planning to connect to the Texas power grid ahead of peak summer demand have failed key reliability tests, raising the risk of power outages just as electricity use hits its seasonal high, according to the state grid operator.
The rapid expansion of data centers processing vast amounts of data for artificial intelligence and crypto mining is straining power grids across the United States.
Unlike traditional industrial customers, which tend to draw electricity steadily and predictably, data centers are engineered to cut their connection to the grid at the first sign of trouble to protect their equipment and keep services running. That makes them an unpredictable and potentially destabilizing force on grids already under pressure from rising demand.
Four groups of unnamed large electricity users, including data centers, abruptly disconnected from the Texas grid during a test of how they would handle routine voltage disturbances, the Electric Reliability Council of Texas (ERCOT) said in a report dated May 21.
When large customers abruptly cut their power use, it can knock the grid off balance and trigger wider outages.
ERCOT, which manages electricity for most of Texas, said it reviewed about 20 gigawatts of large customers seeking to connect to the system, including eight projects totaling roughly 3.9 gigawatts aiming to start up before July 1. It said it identified four groups of large power users that could each trigger more than 5,000 megawatts of demand tripping under certain fault conditions, based on simulations of transmission system disturbances.
Those abrupt drops in demand were equivalent to the electricity consumption of a large city such as Boston.
ERCOT said it is reviewing the test failures and drawing up plans to protect the grid from disruptions. So-called voltage ride-through failures have become a top priority for ERCOT’s board as the risk grows with more data centers and crypto miners connecting to the grid.
Since 2023, ERCOT has identified at least 26 events in which data centers or crypto mining facilities have abruptly disconnected from the grid because they could not handle disturbances in the flow of electricity.
In December 2022, a failed transformer at a substation in west Texas caused nearly 400 crypto miners, data centers and oil and gas production facilities to unplug without warning. The mass disconnection produced a surplus of nearly 1,700 megawatts of electricity, about 5% of the grid’s total demand, and forced 112 megawatts of power generation to shut down, according to ERCOT.
ERCOT and regulators have been tightening interconnection and performance requirements, including new rules aimed at ensuring such facilities can ride through voltage and frequency disturbances without disconnecting.
(Tim McLaughlin in Boston; Editing by Sanjeev Miglani)
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