The power grid has changed more in the past decade than it has in the past five years. Solar, wind, and battery storage have moved power generation away from monolithic power producers. But fundamentally, the power grid still suffers from the same challenges.
“The power grid problem is a peak problem. Most of the time it’s fine and there’s plenty of power. But during peak times you can run out of power,” GridBeyond co-founder and CEO Michael Phelan told TechCrunch.
These shortages are currently being felt most acutely by technology companies and data center developers, who require large amounts of power to train and operate their AI models.
“But if you have enough energy stored in batteries or industrial loads that can be in the hundreds of megawatts, you can start building such hyperscalers,” Phelan said.
GridBeyond has been building hardware and software that connects disparate parts of the grid to act as a larger virtual power plant. The startup already manages about 1 gigawatt of solar, battery storage, wind and hydro power, and on the demand side it has “several gigawatts” across commercial and industrial properties, Phelan said.
GridBeyond recently raised 12 million euros ($13.8 million) in an equity round led by Samsung Ventures to expand its portfolio, the company exclusively tells TechCrunch. Other participating investors include ABB, Act Venture Capital, Alantra’s Energy Transition Fund, Constellation Technology Ventures, EDP, Energy Impact Partners, Enterprise Ireland, Klima, Mirova and Japanese electronics and software company Yokogawa Electric.
The startup is installing hardware controllers in large commercial and industrial facilities, as well as battery and renewable power plants, in Australia, Ireland, Japan, Ireland, the UK and the US.
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Like many virtual power plant companies, GridBeyond, headquartered in Dublin, started on an island. When Ireland started adding wind power, Phelan said, “We faced this problem because we are an island and we needed to balance the grid. So having something like flexible load that we could bring to market was a great fit for Ireland.”
Grid operators have long asked heavy users to reduce their electricity usage during hot weather. For example, paying users a large amount of money to cut peaks in demand. This method is cheaper than building new power lines or power plants. The practice has expanded with the proliferation of renewable energy, allowing industrial and commercial customers to reduce usage at night or when the winds ease.
Recently, batteries have taken on a new dimension. GridBeyond manages several large energy storage facilities, including a 200 megawatt battery in California. New flexible sources can help fill the gap in renewable power.
Batteries have another advantage. That means they respond to demand much faster than traditional peaking power plants, which can take minutes to come online. This will allow the company to quickly buy and sell power in the form of arbitrage trading.
It also opens up new possibilities for data centers. Instead of consuming power continuously, many data centers peak during AI training. These events can cause disturbances in the grid. “You know what broke the Spanish grid, and that’s not what people want,” Ferran said. Batteries located in data centers absorb much of this load, smoothing the profile of the facility on the grid and preventing it from causing unnecessary fluctuations.
Connecting to a nearby virtual power plant or using on-site batteries “obviously makes it easier to connect,” he said.
Updated at 5:30 p.m. ET: The article has been updated to clarify that the investment is from Constellation Technology Ventures, the venture arm of Constellation.
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