Flexible data centers reduce power system costs but can increase emissions

Highlights

• Data center temporal flexibility is modeled for Texas, Mid-Atlantic, and WECC

• Data center temporal flexibility shifts load such that net load is flattened

• Temporal flexibility reduces costs but emissions’ impact is dependent on renewables

• Temporal flexibility can also benefit coal plants by reducing ramping operations

Summary

Data centers are among the fastest growing electricity consumers, raising concerns about their impact on grid operations and decarbonization goals. Their temporal flexibility—the ability to shift workloads over time—offers a source of demand-side flexibility. 

We model power systems in three US regions, Mid-Atlantic, Texas, and Western Interconnect (WECC), under varying flexibility levels. We evaluate flexibility’s effects on grid operations, investment, system costs, and emissions. Across all scenarios, flexible data centers reduced costs by shifting load from peak to off-peak hours, flattening net demand and supporting renewable and baseload resources. 

This load shifting facilitates renewable integration while improving the utilization of existing baseload capacity. As a result, the emissions’ impact depends on which effect dominates. Higher renewable penetration increases the emission reduction potential of data center flexibility, while lower shares favor baseload generation and may raise emissions. Our findings highlight the importance of aligning data center flexibility with renewable deployment and regional conditions.