Powerstack: New data center flexibility plays, a 9.2GW gas data center

Hello from CERAWeek! We’re putting out a full write-up tomorrow, but today, our take on the theme of the week that just keeps getting louder: flexibility.

Next week, we'll focus on what's next for power, given the events at Hormuz. And tomorrow, March 27 at 10am ET, join us for our client-only webinar on what Hormuz means for clean fuels (and what it doesn’t). Sign up now.

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Three announcements during CERAWeek doubled-down on the data center flexibility narrative. EPRI launched Flex MOSAIC, a voluntary but standardized flexibility classification framework for large loads, in collaboration with 65+ utilities, ISOs, regulators, and hyperscalers. NVIDIA and Emerald AI announced a working partnership with major utilities and IPPs to build a new class of flexible AI factories doubling as grid assets. And Octopus Energy, the UK's largest energy supplier, acquired a majority stake in Uplight, a US demand-side flexibility platform.

What happened

Without risk of hyperbole, it’s an interesting time to get all of the biggest energy decision-makers together. Hormuz dominated keynotes, but power demand was the throughline. We got the expected data center announcements, but interestingly, we also got three new flexibility plays:

Mark’s take:

An underlying theme with all this on-site hyperscaler generation is that the grid couldn't serve data centers fast enough so they built their own. There’s SoftBank spending $33bn to build 9.2GW of gas at a single campus, Oracle contracting 2.3GW of behind-the-meter gas through VoltaGrid, xAI putting turbines on trailers. 

But what really got me is this recent SoftBank announcement. A power engineer friend of mine once told me the most amazing thing he ever saw, power-wise, was a 4.5GW combined cycle gas plant that was just there outside his hotel room in Abu Dhabi. He said the turbines just went on forever. Now, here we’re talking about 9.2GW, so, double that, in Ohio.

With turbine order books full through 2028+, every unit that goes behind the fence is one fewer for the grid. But someone still has to keep the lights on. And if this trend continues, the entities with the largest concentrations of fast-ramping, dispatchable generation aren't utilities. They're hyperscalers.

This is why the CERAWeek announcements were so telling. To me, this isn’t hyperscalers wanting to be good grid citizens, there might be some of that, but really it’s the consequence of crowding out. Data centers are buying the generation assets, and with that comes the political pressure to do their part on reliability. 

So, we’ve got a new bargain. Given utilities will struggle more than hyperscalers to get this new capacity built quickly, the data centers will get the turbines, the fast interconnection, and the generation capacity. But in exchange, they start functioning as reliability providers (or as, cough, utilities). If they stay fully grid-connected and let utilities build under specific large load tariffs, none of this flexibility infrastructure would be necessary.

Going forward, I'm watching two things: First, whether Flex MOSAIC creates real, enforceable obligations, or whether flexibility stays voluntary until people forget about it. And second, whether the turbine crunch gets worse, because if it does, hyperscaler-as-utility becomes the norm.

Flexibility platforms and orchestration software. Uplight, Emerald AI, and anyone building the software layer between data center workloads and grid operations. This is a new category -- workload-aware demand response -- and it barely existed two years ago. Octopus just valued it at majority-stake-of-Uplight money.

NVIDIA. They're not just selling chips anymore. The Vera Rubin DSX architecture with built-in flex software positions it as the infrastructure architect for the entire AI factory stack -- compute, power, cooling, and now grid integration. Every data center built to DSX spec is a customer locked into NVIDIA's ecosystem.

Data center developers betting on "build first, figure out grid later." The regulatory window for building GW-scale behind-the-meter gas plants with zero grid obligation is closing. SB6 in Texas is the leading edge, but expect other states and ISOs to follow.

Pure-play gas turbine speculators. If flexibility frameworks succeed in unlocking meaningful capacity on the existing grid -- and the 100GW claim from NVIDIA/Emerald is even directionally right -- it reduces the total new gas capacity the system needs. That's not bad for the climate, but it's a headwind for anyone who bet the farm on up-and-to-the-right turbine demand.

A quick read on the numbers shaping the market. The capex, the contracts, the regs, all anchored in the so-what.

$5bn // LS Power’s purchase price for five gas-fired power plants totaling 4.4GW. LS Power is buying 4.4GW of generation from Constellation Energy from facilities in PJM in Delaware and Pennsylvania. This works out to about $1,142/kW -- a steep discount to new-build costs that now range from $2,200 to $3,000/kW. (The DOJ and FERC forced Constellation to divest PJM assets to prevent it from exercising outsized market power in the region after it bought Calpine). It’s a buyer’s market for those with cash, and PJM especially is a high-risk, high-reward market right now.

2.6GW // Nameplate of Dominion’s Virginia offshore wind project, which delivered first power to the grid this week. The Coastal Virginia Offshore Wind (CVOW) is one of five permitted and underway East Coast wind projects the Trump administration sought to shut down with a blanket 22 December stop-work order, but was restarted this year. Stopping work on in-construction projects is proving difficult, so ones that are far along will probably keep riding-on to completion.

$928m // The amount the Trump administration agreed to reimburse TotalEnergies in lease fees to relinquish its Carolina Long Bay and New York Bight offshore wind leases, the first federal buyout of renewable energy leases in US history. TotalEnergies will redirect the capital to its Rio Grande LNG plant in Texas and other US oil and gas activities. The deal kills ~4GW of planned offshore wind capacity and sets a precedent -- the government will pay you to not build. Ørsted, Equinor, and bp are all watching whether this is a template or a one-off.

120MW // The battery capacity Crusoe can buy from Form Energy under a strategic supply agreement. Crusoe wants to use the batteries to power bring-your-own-capacity (BYOC) contracts with utilities that would let Crusoe interconnect its data centers faster -- although likely still only 2028 or later, given timelines for battery supply and utility approvals. BYOC with emerging tech looks like a long-term hedge, not a default powering strategy. But it does boost the emerging tech, as Form’s announced pipeline has gone up 10X from data center deals.

10MW // The capacity of Form Energy's first European iron-air battery project, developed by IPP FuturEnergy Ireland for COD in 2029. This looks more like a market entry play than a commercial milestone because the project doesn't have an offtake contract and is seeking grants to cover the likely gap between capex and merchant revenues.

Explore more Signals on Sightline here.

The policies, rulings, and company moves worth watching.

DOE and SoftBank’s new announced data center campus at the former Portsmouth uranium enrichment site in Ohio and the largest single data center power commitment ever proposed. It’s anchored by 9.2GW of new gas generation and a $4.2bn AEP transmission upgrade. The project -- part of Japan's $550bn US investment commitment tied to tariff negotiations -- would require building the equivalent of nine nuclear reactors' worth of gas-fired capacity at a single site, a buildout that would take a major utility a decade. We’ll be watching progress closely.

Geo POWER Act introduced in the Senate this week, or more specifically, the Geothermal Power Opportunity With Expanded Regions Act, aims to unlock federal funding for next-generation Enhanced Geothermal Systems (EGS) in regions outside traditional volcanic areas. It would establish a DOE program for innovative financing to expand geothermal development beyond the Western US, using advanced drilling to access deeper heat in lower-permeability regions. If this passes and provides real funding, it could be the great unlock. 

FERC dismissal of RWE Clean Energy's complaint against PJM over interconnection upgrade costs. Interconnection costs for RWE's 125MW solar-plus-battery project in Maryland escalated 57x, from $1.25m to $72m between study phases, forcing RWE to withdraw. FERC ruled PJM followed its tariff but Chairman Swett acknowledged it "raises big-picture concerns" for meeting historic load growth. The case highlights the interconnection cost uncertainty chilling developer investment across RTOs. Watch for whether PJM's post-Order 2023 interconnection reforms address the cost-estimation methodology behind these blowups. And look at Powerstack from last week on where this might all be headed – ie, the SPP CPP model.

X-Energy filing for IPO. The company is riding the wave of surging demand for nuclear power driven by AI data center growth, developing over 11GW of capacity in the US and UK, focusing on small modular reactors (SMRs) that use a more enriched uranium called HALEU, though it hasn't yet received regulatory approval for the reactors themselves.

VPP bills in Michigan and New York. Lawmakers are advancing bills that would require utilities and regulators to create virtual power plant (VPP) programs, allowing third-party aggregators to coordinate distributed energy resources like home batteries and EVs. After Virginia passed its law last year requiring Dominion to get a VPP going, we predicted other states would follow suit. Sure enough, Pennsylvania, Oregon, and New Mexico are also pursuing similar initiatives to unlock the grid benefits of distributed energy resources – watch for more to come.

The latest research, features, and data drops on the Sightline Climate platform.

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Where the market is meeting, and where to find us

📅 Europe Energy Tech Summit // Bilbao, Spain, 15-16 April, 2026 // Europe's premier energy innovation event, hosted at the Euskalduna Conference Centre. Join me, Charles Bondu, and other Sightliners on-site. (Powerstack subscribers can get 15% discount with the code: SIGHTLINECLIMATE)

📅 SF Climate Week // San Francisco, CA, 18-26 April, 2026 // California's premier climate solutions summit, a decentralized gathering with 700+ events across the Bay Area. We’ll be hosting some events, so let us know if you’ll be in town to join our team on site.

📅 Innovation Zero World Congress // London, UK, 28-29 April, 2026 // The UK's largest net zero congress, where technology, industry, and finance unite to power the low-carbon transition. Join our Head of Research, Julia Attwood, on site. 

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