As Energy and Digital Infrastructure Converge, the Future is Flexible

The power grid is at a critical inflection point. Driven by AI, electrification, and industrial growth, electricity demand is rising faster than the grid can expand affordably or sustainably. Utilities are preparing to spend more than a trillion dollars on new generation and transmission this decade, yet their most powerful lever remains largely untapped: making today’s energy infrastructure more flexible.

With more than a trillion dollars also expected to flow into data centers alone, an often-overlooked opportunity lies in demand flexibility—using the existing grid more intelligently while building a more resilient, digital future.

Since we became an independent company in 2019, SIP’s Alphabet heritage and partnerships across the technology sector have given us a front-row view of how energy and computing are converging. Over the years, SIP has built companies at the forefront of two sides of the same transformation. Renew Home harnesses distributed flexibility from millions of homes to stabilize the grid. Verrus builds large-scale data centers that provide flexible, dispatchable capacity. Together, they prove that flexibility is infrastructure.

Why Flexibility Matters Now

The grid was designed for predictability; today, it faces volatility. Historically, utilities treated flexible demand as secondary—a nice-to-have at best and a distraction at worst. That mindset is obsolete. Demand-side flexibility can stabilize the grid faster than new generation, cutting cost, delays, and emissions.

As we outlined in an early 2024 white paper, as utilities’ peak demand increases, more and more latent capacity becomes trapped in the grid. A recent Duke University study supported this work, suggesting that if data centers could flex their electricity use by just 25% for fewer than 200 hours per year, they could unlock 100 GW of new capacity from the existing grid, equivalent to $2 trillion in data center investment. Across the entire energy system, using the grid more intelligently yields massive gains.

Renew Home: Flexibility at the Grid Edge

Building on our foundation in residential energy, we launched Renew Home in 2023 to bring demand-response programs into the modern era by harnessing advances in AI and the adoption of smart devices such as Google’s Nest thermostat. By coordinating millions of smart thermostats and connected devices, Renew Home today can provide about 4 GW of dispatchable capacity during peak events.

With more than five million customers, Renew Home operates the country’s largest residential virtual power plant (VPP) platform. This model delivers immediate value: utilities gain lower supply costs and deferred upgrades, while consumers receive compensation for participation, lower bills, and greater personalization.

In Texas, NRG and Renew Home are deploying hundreds of thousands of VPP-enabled smart thermostats to create a nearly 1 GW AI-powered virtual power plant. Last year alone, Renew Home’s Rush Hour Rewards program delivered over $40 million in rewards and incentives to consumers across more than 100 utilities nationwide.

Smart thermostats alone could unlock nearly 70 GW of flexible load nationwide, roughly equivalent to Florida’s summer peak demand. As electrification adds millions of new connected devices to homes each year, from electric vehicles to batteries, Renew Home shows how distributed flexibility is increasing infrastructure efficiency at scale—today and tomorrow.

Verrus: Flexibility for Hyperscale Data Centers

AI and data centers are now the primary drivers of new electricity demand—and among the grid’s greatest challenges. By 2021, we began seeing data-center developers facing lengthy delays in getting new projects connected to the grid. Developments in AI and overall electrification have since raised the stakes. The IEA projects that global data-center electricity demand will more than double by 2030, a structural shock to grid planning.

After convening leaders across energy, policy, academia, and technology in mid-2023, we published Data Center Flexibility: A Call to Action, arguing that through dynamic load flexibility and collaboration with utilities, data centers can support and strengthen the grid without compromising reliability.

Later that year, we founded Verrus to turn this thesis into reality, reimagining data centers as flexible grid assets that don’t compromise customers’ availability. A Verrus facility combines compute capacity with on-site battery storage and intelligent dispatch systems. This design allows a data center to reduce its power draw from the grid by up to 100% in under a minute, while maintaining 99.999% uptime for mission-critical operations.

This capability has been proven through collaboration with NREL, with whom we conducted the first full-scale simulation of a truly flexible data center. Verrus’ architecture helps utilities manage the AI-driven load wave, enabling growth without waiting a decade for new interconnections. As we scale this design, data centers become grid partners. Flexibility scales up as well as down—from households to hyperscalers.

Unlocking Value Across Scales

Our platforms Renew Home and Verrus represent two sides of the same opportunity: flexibility unlocks efficiency, resilience, and economic value. Renew Home delivers capacity through consumer participation and utility partnership; Verrus provides adaptability through next-generation architecture and faster time-to-market.

They operate at different scales but share the same principle. Renew Home turns millions of small devices into the equivalent of giant power plants, dispatched through AI within minutes to meet the market’s dynamic needs. Verrus enables data centers to shift hundreds of megawatts as nimbly as a thermostat manages a single kilowatt, turning inflexible load into an asset for the grid. Both reduce the need for costly, static infrastructure and deliver greater reliability with less waste—accelerating growth while lowering capital intensity.

The synergy between these approaches reveals something profound about the future of infrastructure. When millions of homes can collectively shed load during a heat wave while data centers simultaneously throttle their consumption, the grid gains breathing room that new generation cannot provide as quickly or affordably. Coordination across scales—from thermostats to server farms—marks a fundamental shift in how we think about energy systems.

The Future Is Flexible

As digital and energy innovations converge, flexibility is becoming the foundation of modern infrastructure. Past distinctions are blurring: between supply and demand, fixed and variable, digital and physical. As batteries and other dynamic resources deploy at scale, we have an opportunity to build energy infrastructure that turns today’s challenges into tomorrow’s strengths.

The next decade will be defined not only by how much infrastructure we build, but by how intelligently we use it. The grid of the future will orchestrate power in real time, matching supply and demand across millions of nodes. Every device—from a smart thermostat to a hyperscale data center—becomes part of this symphony.

Imagine this in practice: an unexpected heat wave hits the Northeast. Instantly, millions of thermostats nudge temperatures up slightly—or pre-cool homes earlier in the day—imperceptible in terms of comfort but enormously beneficial to the grid. At the same time, data centers draw from on-site batteries charged during times of abundant energy, temporarily reducing their use of scarce grid power. The grid absorbs what would have been a crisis through coordinated flexibility. This is intelligent, dynamic infrastructure in action.

Starting with Renew Home and Verrus, SIP is building the infrastructure to unlock this transformation. These platforms demonstrate that flexibility is not just a feature of modern infrastructure—it is its foundation. The companies solving tomorrow’s infrastructure challenges are those turning rigid systems into responsive networks that adapt, learn, and evolve as our needs and opportunities grow exponentially every year.