This episode of This Week in Cleantech, guest-hosted by Jeremiah Karpowicz alongside Mike Casey, covers OpenAI's 20-year, 10-gigawatt Ohio data center lease backed by Nvidia; a New York Times look at the aging transformers leaving the U.S. grid vulnerable to a lasting blackout; a Bloomberg report on battery storage projects stuck for years in interconnection queues; Paul Gerke's piece on the DOE scrapping its last three transmission corridor reviews; and WIRED's Molly Taft on the growing, cross-partisan backlash against AI data centers. This week's Cleantecher of the Week is Heron Power's Drew Baglino.

Episode 145: Featuring Molly Taft from WIRED

Overview

1. OpenAI Locks In Lease for Huge Data Center in Ohio With Backing From Nvidia — The Wall Street Journal
2. The Blackout That Could Devastate America — The New York Times
3. Big Batteries to Bolster the Grid Are Stuck Waiting to Plug In — Bloomberg
4. DOE says we need more transmission, decides building less is fine — Factor This
5. How Data Centers Broke American Politics — WIRED

1. OpenAI Locks In Lease for Huge Data Center in Ohio With Backing From Nvidia — The Wall Street Journal

Mike Casey: First story, [byline pending verification] from the Wall Street Journal: "OpenAI Locks In Lease for Huge Data Center in Ohio With Backing From Nvidia." I'm adding the emphasis on "huge," Jeremiah.

Jeremiah Karpowicz: Huge for many reasons, and data centers — everything. That's going to be something we're talking about a lot today, but ongoing as well.

Mike Casey: But specific to this news, OpenAI signed a 20-year, 10-gigawatt data center lease in southern Ohio with SoftBank's SB Energy. That's the largest data center project announced to date. Nvidia is backing the value of this completed facility to the tune of up to $105 billion, so SB Energy can borrow against the project without lenders worrying too much about what happens if OpenAI ever walks away. Giving yourself options depending on what some of these hyperscalers would do is smart. That's a much smaller ask than the roughly $250 billion all-up guarantee Nvidia was reportedly considering earlier this summer, before investor pushback over the exposure sent its stock down 5% in late July. In this exchange, Nvidia becomes the exclusive chip supplier for that first half of the campus and is taking a $1.5 billion equity stake in SB Energy. So Mike — sorry, Jeremiah — tell us what you think about this. The site sits partly on a former DOE uranium enrichment property and is expected to generate enough power for 7 million homes.

Jeremiah Karpowicz: That's a lot — it's a lot of power.

Mike Casey: It's backed by a 9.2-gigawatt gas plant that will be owned by the U.S. government and financed through the U.S.-Japan trade deal. Jeremiah, it's really good that the hyperscalers are getting underwritten by taxpayers, because as a scrappy, cash-strapped startup industry, they kind of need it. But hey — Nvidia isn't just de-risking someone else's bet. It's also lining up hundreds of billions in chip sales into the same campus and has talked about financing OpenAI's purchase of that hardware, too. SB Energy is also eyeing an IPO as soon as next month to raise $5 to $7 billion [figure unclear in audio — please verify], and this lease gives them a very good number to put in front of investors.

Jeremiah Karpowicz: Yeah, I would say so — that's the understatement of the week. Mike, story number two.

2. The Blackout That Could Devastate America — The New York Times

Mike Casey: Our second story is by [byline pending verification] over at the New York Times, titled "The Blackout That Could Devastate America."

Jeremiah Karpowicz: This is definitely a must-read story if you work in the power industry.

Mike Casey: So, in 2013, snipers shot up a PG&E substation near San Jose, disabling 17 transformers and knocking out enough capacity to threaten a Bay Area blackout. These guys were clearly skilled — knew what parts of the substation to shoot at. They've never been caught. A friend of mine, Jon Wellinghoff, the former FERC chairman, was in the middle of all this. He had subsequent modeling by FERC later find that taking out just nine critical substations nationwide could black out the entire country for 18 months.

Large power transformers — the truck-sized units that step down high-voltage electricity for local use — are mostly bespoke and hand-built, and can take up to five years and cost as much as $14 million each. The U.S. only manufactures about 20% of what it buys. A significant portion of the country's large power transformers were already averaging 38 to 40 years old over a decade ago, meaning many of them are now well past that. The smallest streetside distribution transformers have a 50-year expected lifespan, and 75% of those are already past due to be replaced. So replacing this aging fleet and powering new data centers could double the demand for large power transformers by 2027 — that's next year. This has pushed hyperscalers to pay premiums to jump the manufacturing queue ahead of utilities and factories. If a coordinated attack knocked out enough substations, experts say the recovery could take years, not weeks, since replacement transformers have to be custom-built and are too heavy to move without specialized rail cars that barely exist in North America anymore.

Jeremiah, what do you think?

Jeremiah Karpowicz: You know, I'm really glad that we included this one, Mike, because obviously the headlines are being dominated by data centers — we're going to be talking with Molly about all of that — but this security issue is one of those that's always been around, it's underneath the surface, and it's just so important in a way that stories like this really highlight and bring to the surface. Even that came up at the event that I'm at — more folks are asking about security in a way that they didn't even five years ago. And it's just really important, because dozens of other facilities have really been targeted in this way since the 2013 Metcalf shooting, with similar tactics. In a 2022 attack in North Carolina that left 45,000 people without power for up to five days — but neither of those incidents led to an arrest.

Data centers are accelerating one possible fix, though. Companies like [name pending verification — transcribed as "Ampersand"] and Heron Power are racing to commercialize solid-state transformers, which are modular and easier to replace, with components that are easier to source, swapping hand-wound copper and oil for modular power electronics. Hyperscalers are also becoming the first customers, because Nvidia has already redesigned its data center blueprints around them.

So I think you can see here, Mike — all the things happening in the space, they have these connections, and how data centers could actually have a solution within that, that's enabling this bigger problem. I think there's a lot to dig into. So what's our third story?

3. Big Batteries to Bolster the Grid Are Stuck Waiting to Plug In — Bloomberg

Mike Casey: Summer Maxwell, Bloomberg: "Big Batteries to Bolster the Grid Are Stuck Waiting to Plug In." Jeremiah.

Jeremiah Karpowicz: Gosh, this is another one — battery storage is another topic that's been out there forever, but how it's changing and coming on in a bigger way, I think, needs to be top of mind, and it's something I'm looking forward to digging into for content for our site and our events.

Battery demand is surging — data centers and electrification push electricity use up, but connecting those batteries to the grid is actually getting slower somehow. Nationwide, roughly 750 gigawatts of storage projects are sitting in interconnection queues waiting to get hooked up, and the median wait time has jumped from 1.5 years in 2015 to 5 years in 2025. So where's that going to leave us in 2030 if that keeps going at that pace?

The holdup is mostly equipment — transformers, circuit breakers, and other grid gear that are in such short supply that utilities can't build the upgrades fast enough. PG&E says some circuit breakers now take nearly four years to procure. It's something that comes up in how many different conversations, Mike — we want this equipment, we want it, and the backlog just keeps getting longer and longer, and that's across the board.

In New York, Con Edison started requiring battery developers to help pay for grid upgrades if their project would strain local infrastructure. Its goal was to stop the grid from being overwhelmed by too many projects in the wrong places, but it's raised the average project cost by $21 million and has already led to at least 25 cancellations. So, Mike, a lot here — what do you think?

Mike Casey: Yeah, like the blackout risk outlined in the last story, this battery slowdown is largely a consequence of grid equipment shortages, including transformers. Even when they're cheap and ready to build, batteries are stuck behind the same equipment bottleneck, slowing everything else on the grid. Regulators are trying to unclog the queue by prioritizing further-along projects over a first-come-first-served basis, and penalizing developers who file speculative applications just to hold a spot in line. The bigger picture is that batteries are one of the more shovel-ready tools we have to manage rising demand. But shovel-ready doesn't matter much if there's a five-year line just to plug in.

Jeremiah, our fourth story.

4. DOE Says We Need More Transmission, Decides Building Less Is Fine — Factor This

Jeremiah Karpowicz: Our fourth story is one I have a lot to say about, because that's by the aforementioned Paul Gerke, titled "DOE Says We Need More Transmission, Decides Building Less Is Fine." Mike, you're up first.

Mike Casey: Oh boy. Where do you start? The Department of Energy is killing off the review process for the last three proposed National Interest Electric Transmission Corridors, or NIETCs. These are DOE-designated regions that are eligible for loans and permitting tools intended to speed up transmission development in high-congestion parts of the grid. All seven of the others had already been scrapped back in 2024. These three corridors would have spanned more than 3,500 miles, connecting Canada to the PJM grid, linking the Southwest Power Pool with WestConnect, and expanding tribal energy access. The energy secretary called the review process ineffective at improving reliability or cutting costs. The DOE points to other transmission investments instead, including $1.6 billion and $3.3 billion in loans to utility AEP and its Texas subsidiary, along with over $26 billion for Georgia Power and Alabama Power, both subsidiaries of the utility Southern Company.

Jeremiah, your thoughts?

Jeremiah Karpowicz: I have so many. And Mike, in an exclusive here — I have a piece written up that's going to be dropping on our site next week that really outlines the stakes associated with developments like this, and it uses what Paul's laid out as a starting place to really explore. I think a lot of these stories tell one side of the story around the cost associated with it and potential land displacement, but there's another side of that story, and that's the value that's going to be unlocked in the short term and long term — and that's something that we, as a utility industry, as an energy industry, need to push in a bigger way. But that's for the future.

For right now, the DOE's own draft transmission needs study — the study they released just last month — says the opposite of what this decision does. It flags a, let's quote, "dire need" for more interregional transmission, which makes killing these three corridors literally contradictory. It's not new territory either — Congress first created the NIETC back in 2005 after a wave of blackouts, and the first ones designated in 2007 got struck down by a federal court in 2011 for skipping required environmental review. So these NIETCs have now failed twice under two different administrations for two different reasons — it was a legal process the first time, and this time, let's be charitable and say political friction is the cause. The loans that the DOE is touting instead are real money, but they're upgrades to existing lines, not the new interregional connections that these corridors were designed to build and that the DOE's own study said there's a dire need for.

Mike, I'm going to have a lot more to say about this next week. There might be t-shirts. Stay tuned. So, what's our last story?

Mike Casey: Well, I'm not going to take bets on how quickly those report writers are fired. Just going to point that out.

5. How Data Centers Broke American Politics — WIRED

Mike Casey: All right, our fifth story is by returning show guest Molly Taft, WIRED: "How Data Centers Broke American Politics." Molly Taft, welcome back. I really thought this was an awesome story — it's long, it's in depth, and I think it's a really important read. Give us the big takeaway to get people thinking about this story and enticing them to read it, because I think it's really important.

Molly Taft: Yeah, gosh, there's so many things going on. I think one big takeaway is that when we're talking about opposition to data centers — when I pitched the story back in January, I was noticing a lot of folks in the AI space and in the energy space kind of dismiss data center opposition as just NIMBYism, right? Like, "oh, people just don't like new things in their backyards." People are really concerned about electricity, they're erroneously concerned about water, and the two things that made me kind of sit up and take notice: first of all, for those of us who've watched the opposition to renewable energy, we know that a lot of the so-called NIMBYism comes from a very bipartisan and populist space. I actually reported a couple years ago on the Summit CO2 pipeline resistance, where I went to a meeting that was chaired by both the Sierra Club and Steve King — the congressman who was ejected from Congress for being really racist. It was really fascinating to watch those two sides of the coin coalesce and oppose an industrial energy project.

And then the other thing I was noticing is that some of the first politicians I was keeping track of — more than a year ago at this point, when I first started thinking about how data centers could be a big deal — were right-wing populists like Marjorie Taylor Greene and Thomas Massie, who were the first and only people to put together the idea that Trump's, or the Republicans', roughly ten-year moratorium on state-level AI policy could be used to force through data centers. That was something they were publicly talking about, and they were the only people I saw publicly talking about that. So I thought this is both bigger than just garden-variety NIMBYism and also going to really quickly encompass both parties in a way that is incredibly important.

So I spent most of the piece following this guy named Joe Allen, who rose to prominence on Steve Bannon's podcast. He's a really interesting character, but he's been kind of the anti-tech voice behind Steve Bannon for a couple years at this point. And a lot of people don't understand that opposition to AI runs through both political parties, and a lot of what they're talking about when we talk about opposing data centers, opposing AI, kind of don't fall into the camps that we currently understand in this bipartisan landscape. Trump is working with a lot of these AI companies, he's pushing through data centers — that doesn't mean a lot of the base that voted for him are happy about it, or even that they're going to follow along. So I really wanted to explore what might be coming, and what's already happening, with this opposition.

Jeremiah Karpowicz: That was one of the things that jumped out to me most — that these folks who normally wouldn't be aligned politically are aligned around this issue. So do you think it's indicative of how those otherwise-opposing camps might unite on some other issues — even if "unite" might be too strong a word — that it's going to realign the political coalitions in ways you wouldn't guess?

Molly Taft: Yeah, this is something I honestly grapple with in the piece, and I still don't have an answer. I think the coalitions, on one hand, are going to be differing so heavily on certain issues — I can see if there's another situation with ICE that comes up, that's going to maybe fracture some of these coalitions. There are some really disparate opinions of people who are uniting on this issue. On the other hand, I think that a lot of people are not seeing past data centers, where opposition to tech and AI — which is just increasingly consuming everything we talk about in politics right now — are really going to have these coalitions stick together. I'm thinking about flock cameras especially right now.

Jeremiah Karpowicz: Absolutely.

Molly Taft: They're getting shot out, literally — citizens taking those out. People hate these things. And one thing I consistently heard from the right is that data centers are surveillance machines, and that is one of the things they're really opposed to and don't like. I think that's going to be really huge — these deep conversations about the kind of world we're building, who wins, and who's left feeling increasingly like we're living in Skynet. I don't know the answer to your question, because I don't think we've grappled with anything like this before.

Mike Casey: Yeah, no, just quickly — I mean, what you just mentioned about how the concerns about AI and concerns about data centers previously had been separate issues, but now they're coming together in a way we're seeing across the board. Go ahead, Mike.

Well, I'm actually — my firm is on the ground right now in a southern county that voted for Trump 67%, doing community engagement for data centers. And we were the first ever to poll rural Americans on what they thought of renewable energy built in their midst. Your average conservative, Trump-voting rural community starts at around 25 to 27% opposed to renewables. Your average community anywhere in America starts at 71% opposed. So it's almost 3x — and it did not get there by accident.

So hear me now: if you listen to this show, if you do data center development, and if you think this is a solvable problem by what you've already done, you are going to get your butt kicked — you're going to get rejected. I wrote on LinkedIn yesterday: this fight is just getting started. 71% is not the ceiling — it's the new floor. And if you're going to get a community's permission to build in your midst, you're going to have to stop doing boneheaded things like sneaking this past with a bunch of public meeting notices attended by three half-asleep senior citizens let out of the old folks' home. That doesn't work anymore. You can't buy a bunch of people off. You have to actually explain this, and you're going to have to make these things quieter, much more water-conservative, and you're going to need to power them with clean energy that doesn't pollute the hell out of the neighbors. I can tell you, we are in Trumpy communities, and they are deeply, deeply opposed.

Jeremiah Karpowicz: So Molly, when I saw this, I was like, "wow." And I'll point out there's a Wall Street Journal piece that came out about two days ago that very much echoes what you're talking about, which talks about the remedial-ed classes that the data center hyperscalers are giving themselves about how to relate to communities — but oh my gosh, it's not a day too soon.

Molly Taft: It's really crazy for me, to be honest. I, and I think everyone who's been reporting on this for a while, have been completely shocked at how data center developers didn't seem to see any of this coming. There's a couple of us — a couple folks in the climate space and the renewable space — who, a year or so ago, were like, "oh my god, this is going to be really, really big." And the way they're going about it, especially — the NDAs certainly didn't help, doing it in the dark certainly didn't help, not disclosing your water or electric use certainly didn't help. But at the same time, the insurmountable obstacle of what is actually being constructed to serve whom is also something I don't know how we get around. So good luck to anyone who's trying, I guess.

Mike Casey: Yeah, it's good. Jeremiah, I could — I'm sorry, I'm filibustering on this. We could talk about this all day. I certainly could, but I think we're about out of time. I'm going to go to our Cleantecher of the Week.

Conclusion & Cleantecher of the Week

Jeremiah Karpowicz: We are, but such a great piece that really showcases the present, where things are with this issue, but then also that crystal ball potential political future. Great work, Molly. So, this week's Cleantecher of the Week is Drew Baglino. He's the founder and CEO of Heron Power. And we just were talking about transformers before, and that's why this is such a timely Cleantecher. Baglino is setting out to fix the transformer bottleneck that we talked about — his company builds solid-state transformers that don't rely on the steel causing all of those shortages. And Heron just closed a $140 million round to build a U.S. factory capable of producing 40 gigawatts of the gear a year. So congratulations, Drew — that is the sort of innovation that is going to support and enable solutions to these bottlenecks that we've been talking about.

We also want to thank Alex Petersen and Clare Quirin for gathering these stories, and want to wish happy birthday to birthday girl Molly Taft, for spending some time on her birthday with us.

Mike Casey: Thank you very much.

Jeremiah Karpowicz: So yeah, thanks so much for joining us for this episode of This Week in Cleantech. Please subscribe, give us feedback, share your story suggestions. You can also read all the articles that we discussed this week by clicking on the links in the episode description. Take care — we'll see you next week.