Suppose the AI giants at Alphabet, Amazon, Meta, and Microsoft meet their data center expansion goals. In that case, the U.S. power grid may struggle to keep up with the industry’s massive electricity demands. This challenge has prompted Exowatt, a startup in Miami, Florida, to develop a system integrating a heat collector, heat battery, and heat engine to provide emissions-free energy to these electricity-intensive AI companies around the clock. Last week, at the RE+ industry conference, Exowatt hosted an elaborate event in a Southern California airport hangar, showcasing their shipping container-sized product while the Red Hot Chili Peppers’ song “Can’t Stop” played in the background. Among the attendees was actor and climate-tech enthusiast Leonardo DiCaprio.
Although generative AI is often linked with producing unsettling online images, experts believe AI will transform how we work, learn, and live. AI companies will need much more electricity for this technological shift to occur. “AI models have been doubling in size every three months — a pace that necessitates significantly greater data center power,” stated Jack Abraham, co-founder of Exowatt and CEO of venture studio Atomic, in a release.
After years of stability in the U.S. electricity sector, power demand is expected to rise due to the electrification of vehicles and buildings, a manufacturing surge under the Biden administration, and AI-driven growth of large data centers. Last week, consultancy ICF published a report predicting that national electricity demand will increase by an average of 9 percent by 2028. “Data centers in Las Vegas consume more energy than the entire city of Las Vegas,” noted Jason Hoffman, chief product officer of Switch, during the launch event.
Most major tech companies have set voluntary emissions-reduction targets and are striving to power their new data centers with clean energy. However, challenges like interconnection backlogs and technological limitations hinder their progress, making it difficult to obtain new clean energy quickly and affordably — and nearly impossible to access emissions-free power continuously. Exowatt, which secured a $20 million seed funding round from investors like 8090 Industries, a16z, Atomic, Climate Capital, Felicis, Overmatch, and Sam Altman in April, seeks to capitalize on these trends by providing data centers with a reliable and carbon-free on-site power solution.
Essentially, Exowatt is an energy storage firm with a significant sense of nostalgia. Currently, large-scale energy storage is primarily dominated by lithium-ion batteries using an electrochemical process to store and release energy. In contrast, Exowatt captures solar energy in a thermal battery (essentially a hot brick) that can retain this energy for up to 24 hours. Humans have been storing heat energy in heated materials for thousands of years, and manufacturers have long used hot bricks to conserve energy in the steel production process. Exowatt also employs a Fresnel lens — another vintage technology — to concentrate sunlight onto its hot bricks. This lens, known for its unique concentric circles, was created in the early 1800s for lighthouse beams and has been called “the invention that saved a million ships.” During nighttime or cloudy conditions, Exowatt’s system can heat the bricks to a scorching 1,000 degrees Celsius using electric resistive coils powered by renewable energy sources like wind or solar. Resistive heating technology is about 200 years old.
Another piece of 19th-century energy technology is the Stirling engine, which extracts thermal energy from hot bricks. Developed by Scottish clergyman and engineer Robert Stirling, the Stirling engine generates power by utilizing a temperature difference in gas to move pistons. Although the steam engine surpassed the Stirling engine in most applications, the latter found its niche in specific uses like Swedish submarines and toys.
Startups like Antora Energy, Brenmiller Energy, Calectra, and Rondo are creating their versions of thermal brick energy storage. Several defunct solar companies have also attempted to modernize the Stirling engine and Fresnel lens for large-scale solar projects. However, Exowatt’s CEO shared with Canary Media that the company has refined these traditional technologies for better cost-effectiveness and performance, enabling it to store energy at a significantly lower price and for much longer than lithium-ion batteries, which rely on imported minerals and metals. Exowatt aims to eventually provide reliable, clean electricity at just 1 cent per kilowatt-hour without subsidies, according to CEO and co-founder Hannan Parvizian. This price point is a small fraction of current power costs — both renewable and non-renewable — and would facilitate emissions-free data centers and much more if achieved.
The startup intends to market its module directly to data center and cryptocurrency clients, claiming it has a demand backlog exceeding 1.2 gigawatts for data centers across the U.S. It anticipates starting deployments of its 40-foot container systems later this year, with 25-kilowatt electrical machines available for a $7,500 deposit.
If AI giants cannot source energy from solar, wind, geothermal, or nuclear resources, they will resort to burning fossil fuels that contribute to climate change. Google’s emissions have surged by 48 percent since 2019 due to the energy requirements of AI. Throughout the Southeastern U.S., utilities are planning to construct substantial new fossil gas power plants to satisfy emerging data centers’ demand. This reality underscores the pressing challenge faced by Exowatt — as well as many other companies striving to deliver affordable clean power consistently.
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