Aligning the Digital and Clean Energy Infrastructure Buildout: Notes from Transition-AI 2026

Over the course of two days at Latitude Media's Transition-AI conference in San Francisco last week, I got to see some familiar faces and friends of Spark — leaders from Nodiac, Arevon, Bluearth, Clearway, Enfinity, Halcyon, and MN8 — who were previously mostly seen on screen. I'm usually the one flying out for conferences. This time, energy infrastructure developers came to our backyard for one theme: the AI infrastructure buildout.

The throughline across every session: The data center buildout is forcing the energy industry to rewrite its playbook in real time. A few themes stood out.

Self-generation, despite the controversy, is underway

A year ago, "going island"—a data center that generates its own power instead of drawing from the grid—was a threat that hyperscalers used to pressure utilities. At this conference, it became a serious line of questioning. In one panel, operators from Beale Infrastructure and Digital Realty debated three open fronts: cost premium vs. grid power, proving resilience across equipment types, and avoiding cross-defaults between a gas plant and the data center it feeds. In an islanded setup, those risks are entangled. If the gas plant fails, the data center loses power and may default on its obligations; if the data center fails, the gas plant loses its anchor offtaker. On the grid, that risk is diversified.

Some speakers called fully-islanded microgrids "expensive and unreliable." But nobody pretended that would stop hyperscalers from trying. They're not going to sit in a seven-year interconnection queue in PJM or ERCOT, the two most congested US grid markets.

Battery storage is the only part of the system that's actually ready

A quick reminder: Grid-scale batteries charge when power is cheap or abundant and discharge when it isn't. "Short-duration" typically means 2–8 hours of runtime (usually lithium-ion). "Long-duration" means 100+ hours (Form Energy's iron-air batteries, for example). Each plays a different role.

In the panel on BESS and the Grid, panelists projected the US storage pipeline growing from ~40 GW today to 335 GW. Grid operators in ERCOT and PJM now favor storage additions — a reversal from a few years ago — because batteries bring volatility down and reliability up. Form Energy's pitch at the Speed-to-Power panel landed hard: 300 MW of battery can unlock 1 GW of renewable capacity, because the battery firms intermittent output, letting the grid count the full 1 GW as dispatchable.

Meanwhile, one panelist flagged that PJM has under 1 GW of storage today and isn't expected to exceed that for ten years. If accurate, that's a catastrophic failure of market design. The supply chain is ready. The market structure isn't.

Policymakers are still playing catch-up

What got the most airtime was utility regulatory frameworks and interconnection reform. The consensus: We are moving at the speed of regulation.

Oliver Kerr, Managing Director for North America at Aurora Energy Research, laid out a policy roadmap in his talk Powering the AI Boom: Hype vs. Reality. Three asks: (1) reform large-load interconnection to standardize processes, increase transparency, and weed out speculative projects; (2) incentivize flexibility through standardized requirements and study-process reforms to unlock colocation; and (3) commit to market competition with equitable cost allocation.

Natural gas: part of the answer, not the whole answer

Gas is being built, fast, at hyperscalers. "There is no future of data centers without gas," one panelist put it — and that matched the mood in the room. The panel on Delivering Clean Capacity on AI Timelines added nuance: combined-cycle turbines, the workhorse of modern gas generation, are sold out through the 2030s and require 10% down just to reserve a slot. The fast versions of gas are different animals — simple-cycle peakers, reciprocating engines, or repowering existing assets — and even then, renewables-plus-storage are often competitive on speed.

The real answer is a portfolio: solar, storage, and gas combined, with gas sized for reliability and bridging rather than as the sole solution.

Flexibility went from punchline to product

Flexible compute — a data center that can dial its power draw up or down in response to grid conditions — used to be a pipe dream. At this conference, operators described designs that unlock up to 30% more compute capacity entirely from inside the campus: modulating cooling systems, onsite batteries, and customer-side loads. Emerald AI and others are building the software layer that makes this possible, and the mindset shift at the largest operators has happened faster than anyone predicted.

Where we go next

We're in the first or second inning of aligning these two buildouts. Things are moving fast, and the operators, utilities, and policymakers who move fastest on storage, flexibility, and interconnection reform will set the terms for everyone else.

Working on data centers, load growth, or energy infrastructure? At Spark, we're building software and agents for this world. Starting with the permitting intelligence that the buildout now demands. We’d love to trade notes.