AI's electricity demand means cool new tech is coming to boring grids

Boston Globe

28-01-2025

Massachusetts-based Veir, Inc. is betting that superconducting wires will be an answer to utilities' and data center operators' problems, and it's preparing for the first large-scale deployment of its technology.
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The startup wants to replace sagging metal cables typically strung between pylons or poles with similar-sized black pipes. Inside, there won't be a tangle of metal wires but superconducting tapes — made of a special material that carries electricity without losses — surrounded by liquid nitrogen at -196C (-321F). Veir claims the tech upgrade allows cables to carry 10 times as much electricity as similar-sized aluminum cables.
Other companies have undertaken experimental deployments. One of the earliest was a German government-supported project in 2013 that involved major cable manufacturer Nexans building a kilometer-long line connecting two electrical substations in the city of Essen. The project cost €13.5 million ($14 million) and was in operation until 2021.
But so far, there have been no large-scale commercial deployments of the technology because it's so costly. Maintaining a line at such a low temperature means installing additional equipment such as compression pumps every few kilometers, plus the further expense to keep liquid nitrogen colder than the moon after dark.
Veir's Chief Executive Officer Tim Heidel believes the company has found the solution: Instead of relying on compressors, the company utilizes the same phenomenon that cools our body through sweating.
As sweat evaporates, it absorbs heat from the skin, lowering the body's temperature. Similarly, Veir has built a trash-can sized device that is installed every few kilometers where some of the nitrogen from the pipe is allowed to evaporate and, in the process, re-cool the pipe. The lost nitrogen needs to be topped up, but equipment to do so can be placed at both ends of the long cable.
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'The pace at which data centers are being built and expanding and the urgency of being able to serve higher density and higher power loads is extremely high right now,' said Heidel. 'And so there seems to be quite a bit of interest.'
Veir's investors are betting Heidel is right and that the company's technology will make it a commercially attractive proposition. In a new round of investment announced Tuesday, Veir raised $75 million led by Munich Re Ventures and supported by Microsoft Corp., National Grid Partners and Breakthrough Energy Ventures, among others. (Michael Bloomberg, majority owner of Bloomberg LP, is an investor in BEV.)
In total, Veir has raised $115 million. The new round gives the startup at least two years of runway and will help it show that its technology works by deploying at a data center this year. Commercial projects will only start after that.
But Veir's bet that utilities will pay a premium for cables that carry 10 times more power might not pay off. The company won't give precise numbers, though Veir says initially it can be competitive with some of the most expensive power cable projects, which can cost more than $10 million per mile.
It may remain a 'niche' application, said Peter Wall, grids lead at BloombergNEF. Utilities may say 'we don't want to use it, but we'll eat the cost because it gets us something nothing else can.'
There are also fresh questions about just how much energy demand will grow because of AI. China's DeepSeek has shown that it may be possible to develop advanced AI without needing as much computing power and energy. The company's release of a new model led to a huge rout for US tech stocks, with nearly $1 trillion wiped off their valuations this week.
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If superconducting cables prove too expensive, California-based TS Conductor offers cables that have carbon fiber cores that are able to carry a lot more aluminum without breaking and increase the power capacity of cables three-fold. An even cheaper option is to use 'dynamic line rating' that relies on sensors rather than new cables.
For example, Massachusetts-based LineVision's sensors provide real-time data on windspeeds and cable sag, which tells utilities when a cable is cool and able to carry more power. Without live information, sending more power through the cable can cause it to heat up so much that it sags and breaks, or worse, causes a fire.
LineVision has raised $50 million, including some from the same investors like Microsoft and National Grid. The startup is busy deploying the technologies at commercial scale. For a project in the UK, LineVision installed 11 sensors across a 35-kilometer section of the grid that National Grid says saved it £14 million ($17.5 million) in 2022 alone by increasing power capacity by 19 percent.
LineVision now has projects in eight countries. 'We're not looking to raise more money and believe we're on the pathway to profitability,' said Jonathan Marmillo, the company's chief product officer.
Whether AI's energy demand forecasts turn out to be real or not, it's clear that utilities need to adapt to a changing landscape. With the rise of cheap renewables, energy storage and grid-enhancing technologies, 'more than any other commodity provider, utilities have been forced to deploy new technologies,' said Mark Daly, head of innovation and technology at BNEF.
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