Today, The Fusion Report is focusing on one of the hottest areas driving the need for fusion specifically (and energy in general), the growth of data centers. Data centers have experienced rapid growth as more of the global economy shifts to cloud computing, artificial intelligence, and always‑online digital services. The worldwide data center market was worth about 319.5 billion USD in 2024 and is projected to nearly triple to around 987.7 billion USD by 2035, reflecting a compound annual growth rate of roughly 10–11%. This boom is visible not only in spending but also in physical infrastructure, with estimates suggesting thousands of new facilities will push the global count to well over 8,000 next‑generation centers by 2030 as capacity roughly doubles. Hyperscale operators such as major cloud and AI providers are driving much of this expansion, adding gigawatts of computing capacity and pushing global data center electricity consumption—about 460 terawatt‑hours in 2022—toward a potential doubling by the mid‑2020s. As a result, the growth of data centers is reshaping energy grids and real estate markets worldwide while becoming a critical backbone for AI, streaming, e‑commerce, and everyday digital communication.

Data Centers are Not Good Without Power

Modern data centers require enormous amounts of power because they concentrate thousands of high‑performance servers and networking devices that must run continuously, often at very high utilization to support cloud services, streaming, and AI workloads. New hardware, especially GPU‑accelerated systems for artificial intelligence, draws far more electricity per rack than traditional CPU servers. This forces data center operators to upgrade power distribution, backup generation, and cooling just to keep facilities stable and reliable.

On top of the IT load, nearly as much power can be needed for cooling systems, which must remove large amounts of heat from densely packed equipment to prevent failures and downtime. As demand for digital services grows, the combined electricity use of data centers is projected to reach hundreds of terawatt‑hours per year globally within the next few years, making access to abundant, reliable, and increasingly low‑carbon power a central constraint on where and how new facilities are built.

Nuclear Fission Versus Gas Turbine Power - Which One is Best?

Nuclear power and gas turbine power offer contrasting paths for meeting the rising electricity needs of modern data centers, especially as AI and cloud workloads demand highly reliable, around‑the‑clock energy. As shown by the data from the Clear Cleanview Data Center Tracker, natural gas is significantly ahead of anything else as a choice in the near-term. Nuclear energy—particularly in the form of advanced reactors and small modular reactors (SMRs)—promises very high reliability, low direct carbon emissions, and stable long‑term power prices, making it attractive for operators seeking firm, low‑carbon baseload supply over decades. Its energy density and the ability to co-locate compact advanced reactors with same/similar designs at data center campuses can also reduce transmission losses and enhance resilience against grid disruptions, reducing complexity. Nuclear projects however face significant challenges: very high upfront capital costs, lengthy licensing and regulatory processes, and long construction timelines which do not always align with the relatively fast build‑out cycles and return‑on‑investment expectations typical of hyperscale data centers. Public perception and policy uncertainty can further complicate investment decisions, even as some large technology firms explore nuclear as a strategic long‑term solution.

By contrast, gas turbine power offers lower initial capital costs, shorter development timelines, and highly dispatchable generation that can ramp output up or down to track fluctuating data center loads. This makes gas turbines a more flexible option for on‑site generation, fitting more easily into conventional project financing and enabling faster alignment with near‑term capacity needs. Yet gas turbines depend on fossil fuel supply chains and emit significant greenhouse gases, which can conflict with corporate decarbonization targets and expose operators to fuel price volatility and future carbon policy risks. As a result, many data center strategies treat gas turbines as a bridge or short-term resource, offering responsiveness and relatively quick deployment, while viewing nuclear as a potential long‑term, low‑carbon backbone if cost, regulatory, and deployment hurdles can be meaningfully reduced.

Using Batteries, Solid-State Transformers to Store and Deliver Power Generated Onsite

Battery energy storage systems (BESS) are increasingly integral to modern data centers, providing fast, reliable backup power while supporting efficiency and sustainability goals. Traditionally used as uninterruptible power supplies (UPS) to bridge the gap between grid outages and generator startup, advanced battery systems—particularly lithium-ion—now offer higher energy density, longer lifespans, and improved monitoring compared to legacy lead-acid batteries. When combined with intelligent energy management systems, BESS can enable peak shaving, frequency regulation, and phase shifting/compensation, further reducing data centers energy costs.

Another piece of the puzzle is solid state transformers, particularly for medium voltage uses. Because of the lack of domestically produced grain-oriented electrical steel (GOES), which is critical for medium and large duty transformers, the lead time for these is currently over two years. This is where solid state transformers come into the picture. By using modern electronic circuitry similar to that used in switching power supplies, it is possible to build solid-state transformers (SSTs) that are smaller and more responsive than their analog counterparts. Moreover, their bidirectional nature makes it much easier to integrate them with battery energy storage systems (BESSs).

Where Does Fusion Fit Into The Picture?

Lastly, there is fusion-powered electricity for data centers. As a long-term solution, fusion has a number of advantages: abundant on-demand power, relatively compact generation systems, and much lower operating costs than fossil fuel systems. While there are published plans for fusion powered data centers in the near future, particularly Helion’s plans to support Microsoft by 2028, its 50 MW is a small dent in the 183 TW-hours used by the US in 2024, let alone the power expected to be consumed by 2030. Nevertheless, fusion energy is expected to play a significant role powering data centers by the mid- to late-2030s, and data center operators have invested in fusion as a result. Let's hope fusion comes sooner rather than later as its strongest proponents expect – there will still be a lot of demand in the near future!