Still sizing your power deals like it is 2018? In the AI era, that is the energy equivalent of bringing a butter knife to a data center knife fight.

The problem

AI training clusters and hyperscale campuses are slamming into grids that were built for steady-ish demand, not 24-7 loads with multi-hundred-megawatt step changes. Grid planners from Australia to the US are warning that data center energy demand will climb fast this decade. In Australia, analysts quoting AEMO expect data centers to consume around 6 percent of grid electricity by 2030, raising reliability and flexibility questions, as covered in this report. Regulators are even telling new facilities to show up with their own renewables and battery energy storage so they do not trip the grid, per this guidance.

The solution: dispatchable PPAs

Enter the new favorite of hyperscalers and utilities: the dispatchable PPA. Instead of a vanilla wind or solar contract, developers are bundling firm, fast-response assets - typically new gas peakers plus large battery energy storage systems (BESS) - into one deliverable block. The batteries cover ramps, contingency events, and intraday flexibility; the gas units extend duration and capacity. The result is a package that can track a hyperscaler load and support the wider grid.

Case in point: Amazon's Indiana play

Amazon is backing a multi-gigawatt power build to anchor its Northern Indiana data center expansion. Public filings and reporting indicate a plan sized up to roughly 3 GW of dispatchable capacity. Coverage outlines a combined portfolio that includes new gas-fired peaking plants and a utility-scale battery - on the order of 400 MW for 4 hours, about 1.6 GWh - structured to deliver firm supply to Amazon while strengthening the regional grid. See DataCenterDynamics, Canary Media, and utility owner NiSource’s overview of the arrangement in this post. A project summary describing two 1.3 GW gas units plus a 400 MW 4-hour BESS has also circulated, as noted in this report.

Two details matter for the grid: first, the deal structure uses a generation affiliate to ringfence costs, aiming to protect other ratepayers while adding new capacity, per NiSource. Second, the battery provides fast frequency and contingency support so the gas does not have to chase every blip - key to keeping emissions and wear-and-tear in check.

Not just the US: Germany and Australia go hybrid

Europe’s AI and cloud buildout is also nudging developers toward hybrid, dispatchable setups. Germany recently saw a major transaction tying a 500 MW battery pipeline to data center demand, underscoring how storage is becoming part of the site-selection toolkit, as reported in this roundup.

In Australia, the message is explicit: bring your own renewables and big batteries. AEMO’s stance has been covered widely, including in this guidance. The country also offers a template for how large batteries can harden the grid. New South Wales’ Waratah Super Battery - 850 MW and 1,680 MWh - is contracted as a System Integrity Protection Scheme that acts like a grid shock absorber, enabling higher transfer on critical lines, per Australia’s regulator and project office in this determination and this project brief.

Why these dispatchable PPAs matter

• Grid reliability: pairing gas with BESS creates a controllable block that can ride through disturbances and sudden load swings. Waratah’s SIPS contract shows how guaranteed fast discharge can stabilize lines during faults, as explained in this determination.
• Emissions and curtailment: batteries absorb midday oversupply and shave peaks so gas runs fewer hours. Waratah’s paired generation services illustrate how storage and generators coordinate to keep flows safe while using more renewable energy, per this brief.
• Interconnection realism: instead of waiting years for queue upgrades, hyperscalers are co-developing new capacity sized to their load. The Indiana structure explicitly adds new generation and storage without shifting costs to other customers, according to NiSource.
• Battery deployment flywheel: data centers are becoming anchor customers for multi-hundred-megawatt BESS. PJM, the US’s largest grid, is now granting interconnection agreements to new standalone batteries, a sign the storage pipeline is finally moving, as covered in this update.
• Pathways to cleaner dispatchable power: not every firm block needs gas. Google’s Nevada campus is leaning on enhanced geothermal for round-the-clock carbon-free energy through a tariff with NV Energy, as noted in this update and this filing.

2026 and beyond: what to watch

• Duration creep: today’s 4-hour BESS is the default, but larger campuses will test 6- to 8-hour stacks where economics pencil, especially as renewables share grows.
• Clean firm supply mix: expect more geothermal pilots and potential expansion of flexible nuclear or CCS-linked gas as alternatives to peakers for 24-7 coverage, following the pattern in this Google-Fervo collaboration.
• Procurement goes 24-7: corporate buyers are shifting from annual MWh to around-the-clock profiles. Hybrid PPAs that bundle variable renewables with BESS and firm capacity will become standard.
• Co-siting and transmission relief: batteries sited at or near data centers will increasingly provide local grid services while shaving coincident peaks - exactly the outcome Australian planners are pushing in this guidance.

The bottom line: AI-era data centers want power that is clean, cheap, and controllable. Gas plus BESS PPAs are the pragmatic bridge - and they are pulling forward battery energy storage deployment timelines in a very real way.