When it comes to powering the AI era, both opportunities and challenges are plentiful. AI workloads are dynamic and energy-hungry, demanding unprecedented volumes of power. Accommodating these fluctuating workloads requires sourcing power that is not only fast, but also clean and reliable.

Compounding the challenge, transmission and distribution – the essential process of getting power from where it’s produced to where it’s needed – can’t keep up with the speed of how AI is evolving. Alternative power generation solutions outside of the traditional electrical grid are needed that can scale in tandem with the rapid adoption of AI.

Against this backdrop, onsite power generation is stepping up to meet the mark. Generating power at the point of use, rather than relying on aging grid infrastructure, offers speed and autonomy.

But with many different flavors of onsite power generation to choose from, how can operators ensure they select a sustainable solution that achieves the speed, scale and reliability synonymous with success in today’s AI-driven industry?

Founded more than two decades ago, Bloom Energy is well-equipped to guide operators through the decision-making process. Bloom’s director of technology strategy, Akhil Batheja, makes the case for fuel cells as the solution of choice for reliable onsite data center power.

Out with the old, in with the new?

Put simply, onsite power means generating electricity exactly where it's required – eliminating the challenges associated with large-scale transmission and distribution. In today’s high-stakes, fast-moving environment, that kind of access and independence is a distinct advantage.

“In many ways, it allows data centers to own their destiny,” says Batheja. “Operators can identify the exact solution that meets their unique requirements in a timely manner and effectively balance sustainability, reliability, and efficiency.”

It’s becoming increasingly unrealistic to rely solely on the electrical grid to power the AI era. The traditional model of centralized power simply isn’t designed to meet today’s demands. But rather than abandoning the grid, this reality is paving the way for alternative solutions like onsite generation to provide a much-needed partner.

“The name of the game right now is more power, and we’re not ruling out any generation solutions – instead, we help to diversify sources,” explains Batheja. “Often, these newer technologies are deployed in conjunction with traditional power, allowing data center operators to realize the greatest value.”

As the AI boom continues to accelerate, the demand for more of the right kind of power will only grow, tipping the scales toward alternative power sources to meet the volume and performance that modern operations require.

“That ratio is only going to rise,” adds Batheja. “Demand is accelerating and supply must match pace. You don’t have to look far to see AI becoming more embedded in personal and professional life – and that’s rapidly increasing the need for scalable, alternative generation.”

In fact, Bloom’s recent Data Center Power Report: Mid-Year Pulse revealed that 27 percent of operators foresee data centers becoming solely reliant on onsite power in the near future.

“That’s a huge statistic,” says Batheja. “Just a year or two ago, I’d confidently say that number would’ve been around one percent.”

The right solution: Fuel cell technology

With data centers firmly at the heart of our digital lives, maintaining uptime, deploying assets quickly, managing fluctuating workloads, and ensuring smooth, efficient operations are all mission critical. Delivering on these demands starts with sourcing power that can meet the needs of AI. That’s where fuel cell technology comes in.

Much like solar panels convert sunlight directly into electricity, Bloom’s fuel cells convert natural gas directly into electricity without combustion, pistons, or turbines. This direct conversion takes place in a solid-state device with 54 percent efficiency – the highest of any power conversion technology. Batheja explains the added sustainability benefits:

“Higher efficiency means less fuel, and less fuel means less carbon dioxide. Secondly, non-combustion means near-zero air pollutants, and third, our fuel cells consume no water during normal operation – we describe this as water neutral.”

Once deployed, performance is consistent regardless of geography. Unlike other power systems affected by temperature, humidity, or altitude, fuel cells are able to maintain performance whatever the weather – allowing operators to scale confidently wherever they choose.

In a time when the only constant is change, adaptability is key. Bloom’s fuel cells are fuel-agnostic, meaning they’re able to run on natural gas, biogas, or hydrogen. This means the technology can flex to whatever energy source is most readily available.

Batheja sums up the three core benefits of fuel cell technology – speed of deployment, reliability, and cost-efficiency:

“Thanks to Bloom’s investments in its manufacturing capabilities and control over its own supply chain, time to market can be delivered in months, not years. Non-combustion and the sustainability credentials that come with fuel cells also makes permitting faster and easier.

“The core of the technology has no moving parts that could risk a system breakdown. Our onsite solutions are modular, with compact, standardized designs built with quality and redundancy as standard. And thanks to consistent innovation, fuel cells have become one of the most cost-competitive forms of onsite generation.”

Fueling and cooling AI

AI workloads can fluctuate in a matter of milliseconds, and fuel cells’ direct energy conversion process enables them to respond almost instantaneously. As solid-state devices, their load response time is twice as fast than turbines and engines.

With less space needed for backup power and storage systems, the technology also supports high-density server configurations. Batheja explains how fuel cells can help solve the added cooling challenges that come with compacting these densities:

“One of the biggest trends that’s come from AI is rising rack density. Each rack holds more powerful chips in a smaller footprint, which is great for efficiency but produces more heat.

“To solve this, we can use waste heat from our fuel cells and run it through an absorption chiller, which turns that heat into cooling. That cooling helps offset other energy costs and improves overall efficiency.”

Just like AI is reshaping workloads, fuel cells are reshaping facility design. With thoughtful planning early in the design phase, operators can harness what is essentially free cooling to reduce emissions, cut energy consumption, and increase overall operational efficiency.

Generating value

Fuel cell technology was once dismissed as a niche, expensive option – but today, that’s far from the reality. Over the past decade, Bloom has worked continuously to improve efficiency and drive down costs in order to provide the greatest value for its customers.

“When I talk to data center operators, it’s the total cost of ownership that really matters to them,” says Batheja. That comes down to two key components: upfront cost (capex) and operating cost (opex).

Bloom has consistently delivered double-digit percentage cost reductions in upfront investment through its engineering innovation. And because fuel cells are more reliable, there's less need for overbuild – designing larger systems with redundancy built-in to compensate for potential downtime.

“Operating expenditure also matters,” adds Batheja. “Fuel is the biggest cost driver. Since our fuel cells are 15-20 percent more efficient than other onsite generation methods, operators spend significantly less on fuel. When you add both capex and opex savings, the total cost advantage is clear.”

No longer an up-and-coming underdog, fuel cell technology is a mature, proven source of primary power that operators can deploy on site with confidence.

Crucially, fuel cells not only address the most pressing challenge facing the industry today – the demand for more power – they also meet the complex, high-performance demands of AI workloads, while driving efficiency, sustainability, and value in the process.

Explore more about the fuel cell advantage, here.