SemiAnalysis: Data Center Power Grid Bottlenecks Intensify, Backup Gas Generators Shifting to Round-the-Clock Power Supply

Odaily reports that SemiAnalysis stated on X platform that traditional backup power equipment for data centers——Reciprocating Engines——are transitioning from an "emergency backup" role to a primary round-the-clock power source to meet the massive electricity demand driven by AI computing expansion.

SemiAnalysis points out that in the past, data centers typically only activated on-site reciprocating engine backup power during grid failures, operating for just a few hours annually. However, with increasing grid capacity constraints, more data centers are repurposing these devices for Prime Power, enabling continuous electricity supply.

According to SemiAnalysis' energy model estimates, manufacturers of reciprocating engines, including Caterpillar, INNIO, and Cummins, are expected to have signed approximately 1 GW in Behind-the-Meter (BTM) project orders this year; order volumes for 2027 and 2028 are each projected to exceed 4 GW.

SemiAnalysis notes that current order volumes are still very limited compared to future potential demand. After modeling US grid constraints, they found that existing power supply margins are expected to be exhausted between 2027 and 2028, and planned utility-scale new generation capacity through 2030 is insufficient to meet the growing data center load demand.

Based on its data center model, SemiAnalysis estimates that approximately 140 GW of identified data center projects still need to sign power supply contracts and may adopt behind-the-meter power supply models.

Among the technologies available for behind-the-meter power supply, including reciprocating engines, aeroderivative gas turbines, and fuel cells, SemiAnalysis expects reciprocating engines to capture the largest share.

The institution believes that reciprocating engines offer the best balance between cost and deployment speed, while also providing modular advantages that support phased data center expansion. Compared to fuel cells, they boast higher commercial maturity and financing feasibility. As manufacturers ramp up production capacity in the coming years, reciprocating engines are poised to become critical infrastructure for AI data centers to solve power bottlenecks.

SemiAnalysis states that AI computing growth is driving data centers to shift from relying on traditional grid power to a hybrid model of "grid plus self-owned energy," with energy infrastructure emerging as a new core constraint for AI industry expansion.