Google, Nvidia and Anthropic back Emerald AI coalition aiming to free 100 GW of grid capacity for data centers

Grid software unicorn Emerald AI has formed a coalition with Google and Nvidia that will use the startup's technology to secure space on the grid for more data centers, TechCrunch reported on September 17. The group is called the AI Energy Management Alliance (AEMA), and Anthropic joins the founding trio alongside utilities including AES, Constellation, National Grid and NRG Energy.

The coalition's goal is to make demand response an integral part of data center development. Pausing noncritical tasks and shifting some compute loads, AEMA says, could allow an additional 100 gigawatts of data centers to connect to the grid.

Demand response is an old concept that utilities have used for decades. It works because the grid is designed around peak loads, while for much of the year demand sits well below the maximum the grid can support. Traditionally the participants were large electricity users such as factories, which agreed to cut usage during high-demand periods, typically by pausing production or switching to backup generators, and were paid handsomely by the utility in exchange. Data centers can already take part in those programs today, usually by turning on backup diesel generators.

Emerald AI has been proposing an alternative to those diesel generators. Its software coordinates requests from utilities with data centers, which can pause noncritical tasks or shift loads to other data centers where the grid has some headroom.

It is not the only company working on the problem. TechCrunch notes that Google has been developing its own tools, and that Enel X lets data centers tap their uninterruptible power supplies to round off peaks in power demand. A Goldman Sachs study published last year estimated that limiting maximum grid usage to 90 percent for a few hours at a time could free up 76 gigawatts of capacity.

Emerald AI does have an advantage, though. Its software connects utilities directly to data centers, which should let facilities respond to requests quickly, much like batteries. The startup also recently raised $150 million in a Series A led by Energize Capital and DCVC, giving it the funding needed to roll the technology out on a wider scale.

Given the peaky nature of AI compute loads and data centers' ability to quickly ramp up and down, the creation of something like AEMA is overdue. The coalition also promises to help tech companies and utilities find new sites for data centers, an effort that has not been easy for either party.

Despite its promise, more sophisticated demand response will not solve all of the grid's problems today. Ayse Coskun, Emerald AI's chief scientist, told TechCrunch that her company's technology promises to blunt the industry's need for new generating sources, but will not eliminate it entirely. In other words, the coalition addresses peaks and interconnection bottlenecks rather than the long-run shortfall in generation and transmission, and the next test is whether its members turn pilots into a standard grid-connection process.