U.S. data centres are projected to require approximately 65 gigawatts (GW) of power between 2025 and 2028, nearly 45 GW more than the current grid can accommodate. With interconnection timelines for U.S. power projects averaging five years and more than 2,200 GW of projects awaiting approval, existing interconnected assets are being utilised to help bridge this immediate demand.
Babcock & Wilcox Enterprises, Inc. (“B&W”) announced the formation of a strategic partnership with Denham Capital’s Sustainable Infrastructure division (“Denham”) to pursue new power generation opportunities in the U.S. and Europe. The partnership will be based on technologies that repower coal plants to natural gas facilities for energy production, in addition to back-end environmental technology, to address the growing demand from data centres.
The effort will entail substantial investment in the transformation of coal plants to natural gas plants as a much cleaner alternative, a necessity for the clean energy transformation that is currently underway. Natural gas is a fast-deployment and cost-effective option that will allow data centres to tap into reliable power until renewable generation can grow to levels that match with demand.
Denham adds worldwide experience in the development, financing, and operation of large-scale energy projects across six continents, while B&W adds decades of industry leadership in coal power generation and fuel conversion technologies. Combined, the companies are well-positioned to provide sustainable infrastructure solutions for meeting increasing demand for reliable and flexible energy for data centre developers.
Justin DeAngelis, Global Head of Sustainable Infrastructure at Denham Capital, stated, “Data centers have created an unprecedented and immediate demand for power generation, the likes of which we have not seen in nearly two decades. Time-to-power is a key focal point for data center developers and hyperscalers, and this partnership is one differentiated tool we are looking to utilize to meet market needs.”
He further added, “We are delighted to partner with B&W to offer reliable, fast, low-cost and sustainable power solutions to the data center market, leveraging B&W’s nearly 160 years of expertise in power boilers, and bringing Denham’s 10 GW of experience in developing, constructing or operating power generation,”. He said “Given the scale of this opportunity, Denham will shortly announce a dedicated portfolio company focused on delivering these solutions. It is vital we leverage existing power fleets, decarbonize, and increase the quality and security of our power generation systems.”
Kenneth Young, B&W Chairman and Chief Executive Officer, highlighted that the joint capabilities of B&W and Denham enable them to address this expanding demand effectively. “This partnership brings two well-established, experienced teams together to quickly and effectively identify opportunities to leverage underutilized coal-fired power plants to provide affordable, reliable power for large-scale data centers,” he said. “The rapid growth of AI and datacenters is driving demand for new, dedicated electrical generation capacity for these facilities, and we see a tremendous opportunity to help customers meet their energy needs affordably and efficiently. With our vast experience and our broad suite of both traditional and new technologies, we are well-positioned to support the power demand from data centers and global AI growth now and in the future.
As a global provider of combustion and environmental solutions for multiple fuel types, B&W has the resources to manage complex energy conversion projects, from planning through execution, while continuing to supply parts and services that ensure long-term reliability of fleets.