Data Centers Provide Potential Market for Hydrogen Technologies

On July 27, Microsoft announced that it had successfully powered a row of data center servers using hydrogen fuel cells for 48 hours, a success for the tech company as it aims to decarbonize. To date, Microsoft and many other companies have used diesel generators for backup power at their data centers since they are relatively inexpensive. However, as costs for hydrogen-powered technologies such as stationary fuel cells decline, hydrogen is becoming a more cost-effective and clean alternative.

Data centers are essential to businesses that must maintain an uninterrupted power supply (UPS) to provide data to companies and customers. Typical data centers rely on grid power with diesel or natural gas backup systems. Fuel cells can be used to provide backup power in concert with current data center power systems or they can be used to power the data system on their own, eliminating the need for backup power due to their UPS capabilities. Additionally, byproduct heat can also be recovered for heating and cooling, especially from high temperature fuel cells such as solid oxide and phosphoric acid.

Hydrogen’s Decarbonization Potential for Data Centers

In 2020, data centers are expected to constitute 3.5% of the total electricity demand worldwide. Shifting to fuel cells, especially those powered by hydrogen, has potential to significantly decarbonize this consumption. However, how hydrogen (and other fuels) are sourced is a key component when looking at life cycle emissions.

Presently, almost all hydrogen is produced through a process called steam methane reforming, and very little of this hydrogen is used in the power sector. This dynamic appears to be changing, though. Green hydrogen, or hydrogen produced via electrolysis using renewably sourced electricity, has become increasingly cost-competitive with fossil-based grey hydrogen. While green hydrogen is not on par with grey hydrogen quite yet, there has been an uptick in project deployments and the scale of these projects. Most recently, the EU announced that it is aiming for 40 GW of electrolysis by 2030, a figure that would completely reset the marker. The US Department of Energy (DOE) has also recognized the potential for hydrogen use in data centers and created a workshop titled H2@Datacenters to facilitate collaboration with DOE, industry, and end users.

Moving Forward, Hydrogen Can Help Achieve Climate Goals

It is becoming increasingly clear that hydrogen will need to be employed if we are to meet future climate goals. To what extent hydrogen will be deployed is still to be determined, but data centers provide an opportunity for hydrogen to showcase its ability to provide UPS renewably. With proper policy support and continued foundational work for hydrogen projects like those mentioned above, hydrogen will have the opportunity to drive the energy transition.