Three Crazy Ideas
How data-center backlash can spur your innovation
We are past peak data-center excitement. But we’re not close to peak data-center opposition.
Are you—the energy leader— tempted to lie low until the public outrage moves on?
It’s not going to work like that. Energy leaders won’t be able to build on the amazing energy-demand opportunities unless they run toward the risks.
In fact, I’m telling leaders I advise to embrace and act on the backlash.
Does that sound crazy? After all, communities feel ambushed, developers feel cornered, and activists are assuming the worst intentions and outcomes. The stakes are high, and the risks and incentives are often badly aligned.
But in this fog of confusion and anxiety, energy proponents and developers are missing the inherent opportunities.
Today I give you three crazy ideas to seize those opportunities.
Both of these things are true:
Data centers are now a high-risk endeavor for developers and a political liability for community leaders.
Data centers are also the best forcing function we’ve seen in years toward modernization of local energy systems—including the building of “firm” decarbonization pathways that climate activists have struggled to advance.
Let’s figure out how to take the big risk posed by opposition and get some good things done.
The situation
The power needs of data centers are effectively equivalent to those of industrial megaprojects. And yet they are being permitted and negotiated as a series of one-hit wonders for the local communities. The mismatch has set the stage for community backlash and left crucial opportunities off the table.
The misaligned risks are predictable:
Communities take the disruption.
Ratepayers fear cost shifts.
Utilities carry reliability risk.
Developers want schedule certainty.
Environmentalists want externalities to be addressed—emissions, water, justice.
Residents want better communities on the other side of construction.
Anyone can block a project—and a lot of anyones are finding common cause wherever the project doesn’t present a clear value proposition for the relevant stakeholders, regardless of political climate and local economic needs. How are community leaders and industrial developers to address this risk when no one owns responsibility for the whole system and the opportunity it represents?
Three (entirely sensible) wild ideas
If your job is to provide power, build infrastructure, or secure permitting for these projects, stop trying to convince stakeholders to love (or ignore) data centers. Instead, use data centers to propose an energy vision they can champion—with clear community benefits, a credible decarbonization trajectory, and explicitly named trade-offs.
Crazy Idea No. 1: Build the energy system of the future
The premise: Treat the data center as the anchor tenant for a locally optimized generation and transmission build-out.
What could this look like?
A three-party compact between a local government, a local utility, and a land developer
An “ideal system” plan that (a) identifies the new infrastructure that’s required, the upgrades needed, and what has to be decommissioned; (b) looks at the system holistically (generation mix, transmission and distribution, and demand response); and (c) proposes the ideal end state
A sensible, defensible cost-allocation framework that specifies who pays for what and why
A vision for the possibilities that an upgraded energy system provides, such as the ability to attract new industries, affordable power rates for residents, and the end of weather-caused blackouts
Tangible community benefits such as workforce training, student scholarships, and recreation infrastructure
Why might community champions emerge?
This proposal provides a community improvement opportunity (long term) with immediate tangible benefits
It makes grid upgrades visible and locally valuable (including resilience, reliability, and future electrification capacity).
Power infrastructure creates other community improvement opportunities, from attracting new businesses to lowering rates.
The ideal system addresses community priorities, including decarbonization, based on local resources and preferences.
Trade-offs to balance: faster load growth and land impacts, in exchange for an energy system that can support broader community goals.
Crazy Idea No. 2: The innovation lab
Premise: Use power demand to test innovation solutions that will drive the next-generation energy system: lower environmental footprint, lower carbon intensity, lower cost. This can be combined with Idea No. 1 if innovation answers a community priority.
What could this look like?
Developer investments are combined with utility programs and state or federal grants to build energy-innovation pilot projects into the data center and its power development; this includes technology, system, or business innovations along the entire power and data-center value chain.
The process allows a speed-to-market solution to be paired with commitments to enhance the power and data-center innovation ecosystem.
The effort can be coordinated with local universities, innovation incubators, and economic development organizations to build local pipelines of workers, small businesses, and research wins.
Why might community champions emerge?
This proposal generates honest and transparent balancing of timing, cost, and innovation.
It uses power demand and investment dollars to systematically test solutions and expand innovation pipelines.
Climate, environmental, and innovation hawks can put their money where their values are, creating solutions that can be replicated across regions that don’t want to be first movers.
Trade-offs to balance: higher near-term emissions and an imperfect supply mix, against accelerated scalable abatement and reliability solutions later.
Crazy Idea No. 3: Gas to-nuclear-power project
Premise: Design the bridge to zero emissions with a realistic destination.
What could this look like?
Phase 1: Use unabated natural-gas-fired generation for speed to market and grid reliability.
Phase 2: Add CCS and its infrastructure (capture, pipeline, sequestration) to rapidly drop emissions while maintaining firm power.
Phase 3: When nuclear is financeable and sitable, swap it in as the power generation. Keep the CO₂ transport and storage system in place as a long-lived asset for other carbon emissions point sources, to create negative emissions, offsetting the early emissions from the site.
Why might community champions emerge?
This proposal offers a credible pathway to net zero.
It builds permanent infrastructure that has value beyond the initial anchor tenant, creating a path for long-term negative emissions through sequestering carbon.
They get a realistic timeframe pathway to nuclear.
It doesn’t pit natural gas against nuclear. It also doesn’t lock in natural-gas-fired generation indefinitely.
Trade-offs to balance: local natural gas buildout now, in exchange for a defined emissions-down schedule and durable carbon management infrastructure later. The initial infrastructure must be right-sized to recoup costs over time.
Seize the day
These three crazy ideas are conversation starters designed to challenge you to think differently. We can convert the demand and disruption of data centers into opportunities for community stakeholders, climate hawks, and innovation buffs. Take my crazy ideas and make them better! Here’s the three-step approach:
Think bigger than the fence line and today’s need to build.
Acknowledge everyone’s enlightened self-interest: Align incentives instead of arguing about tribal politics.
Name trade-offs clearly and proactively to ensure that community solutions prioritize community needs and values.
Making the most of The Moment
Let me help you help me make big ideas a reality.
Forward my crazy ideas to your business-development colleagues.
Reply with your toughest project risk challenge—and let’s stress-test these ideas.
Review The Myth and The Moment to help me get the word out.
Hit that heart button to show your enthusiasm for big ideas.
Welcome to crazy town—where stuff actually gets built,
Tisha