Data Centers Reduce Reliance on Power Grid

Report shows data centers are investing in onsite power and moving to power-friendly regions to meet growing demand

Published on Feb. 27, 2026

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According to a new report from Bloom Energy, data center leaders are reducing their reliance on utility grids by investing in onsite power for rapidly scaling data centers. The report also found that power availability is driving data center development decisions as the industry moves into new power-friendly regions, suggesting a significant structural market shift for "AI factories" and other high-density data centers.

Why it matters

This shift towards onsite power and strategic geographic placement of data centers highlights the growing importance of reliable and abundant power supply to support the exponential growth of data-intensive technologies like AI. As data centers become larger and more power-hungry, their ability to secure and control their own power sources will be critical to meeting demand and avoiding disruptions.

The details

The report found that over 50% of new data center campuses are predicted to exceed 500 MW by 2035, with nearly one-third exceeding 1 GW. This massive scale means each 1 GW campus will consume roughly as much electricity as the entirety of San Francisco. To meet this growing demand, data center developers are increasingly looking to power-friendly regions like Texas, which is poised to capture nearly 30% of the U.S. data center market share by 2028. Meanwhile, traditional hubs like California, Oregon, Iowa, and Nebraska are expected to see their relative market shares drop by more than 50%. Developers are also designing data centers to operate more independently of the grid, with 45% expecting to adopt direct-current (DC) distribution architectures by 2028.

  • The 2026 Bloom Energy Data Center Power report is based on surveys conducted in November 2025.
  • The report predicts that by 2028, Texas will capture nearly 30% of the U.S. data center market share.
  • The report also predicts that by 2035, over 50% of new data center campuses will exceed 500 MW, and nearly one-third will exceed 1 GW.

The players

Bloom Energy

A company that provides onsite power solutions for data centers and other energy-intensive facilities.

Natalie Sunderland

Bloom Energy's Chief Marketing Officer, who commented on the report's findings.

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What they’re saying

“Data center and AI factory developers can't afford delays. Our analysis and survey results show that they're moving into power-advantaged regions where capacity can be secured faster—and increasingly designing campuses to operate independently of the grid.”

— Natalie Sunderland, Chief Marketing Officer

What’s next

The report suggests that states and regions that can adapt to support large-scale AI deployments and provide reliable, abundant power will be well-positioned to capture a growing share of the data center market in the coming years.

The takeaway

The data center industry's shift towards onsite power and strategic geographic placement highlights the critical importance of reliable and abundant power supply to support the exponential growth of data-intensive technologies. As data centers become larger and more power-hungry, their ability to secure and control their own power sources will be a key competitive advantage.