Why behind-the-meter generation is changing the power equation for data centres

Behind-the-meter generation is emerging as a potential solution to the data centre sector’s power challenge. As grid connection delays lengthen across Europe, operators are increasingly exploring how on-site generation can support earlier energisation, phased development and greater flexibility.

Across Europe, data centre growth is being constrained not by land or capital, but by access to power.  

That challenge is not entirely new, but its scale is changing quickly. AI workloads, high-density compute, and the continued expansion of hyperscale campuses are driving power requirements to levels that many electrical networks were never designed to accommodate at this pace. In some markets, grid connection dates are stretching years beyond planned timelines. For operators trying to deliver capacity in an increasingly competitive market, there is a serious commercial problem.

As a result, behind-the-meter generation is becoming a central part of power strategies. Once associated with standby resilience, on-site generation is increasingly being evaluated as a way to accelerate the deployment of data centres whilst reducing dependence on constrained grids. This isn’t limited to backup power. In some cases, operators are reviewing whether on-site generation could support partial operation whilst the grid infrastructure catches up.  

The approach is not without its challenges, particularly regarding sustainability and long-term emissions. As connection constraints intensify, pragmatic energy strategies are becoming essential.  

The grid challenge is a deployment challenge

The growth of the data centre sector is outpacing grid expansion.  

Across the UK and Europe, network operators are dealing with increased electrification and the integration of renewable energy. They are doing this while modernising their ageing infrastructure. Data centres are entering that environment with very large, highly concentrated loads and the expectation of rapid delivery. The two timelines between the grid and the data centre very rarely align.  

For operators, the issue isn’t about whether the power is available to them. It’s when.  

Grid connection delays of several years can jeopardise a development’s viability. In some regions, projects secure land but stall due to lagging network reinforcement. Growing AI-enabled campuses raise the stakes, often reaching hundreds of megawatts.  

This is beginning to change how sites are evaluated. Access to transmission infrastructure and proximity to gas networks are playing a greater role in early decision-making.

In parallel, operators are reviewing how independent energy infrastructure could reduce reliance on the utility delivery programme. That does not necessarily mean disconnecting from the grid entirely. More often, it means creating enough flexibility to bring capacity online sooner and expand over time.  

Why is behind-the-meter generation re-emerging?  

Behind-the-meter generation refers to power generation installed on the customer side of the utility connection. In the data centre sector, this typically means gas-fired generation assets operating as part of the site’s wider energy strategy.  

The renewed interest is driven mostly by speed.

Grid-scale infrastructure upgrades are complex and slow-moving. This is particularly true where transmission reinforcement is required. On-site generation can often be deployed faster, allowing operators to energise facilities earlier or phase developments while waiting for permanent utility capacity. In markets where demand is significantly outpacing available power, that advantage is commercially significant.  

We’ve seen the US already move in this direction. In several of its regions, developers are using gas-based behind-the-meter systems to support large-scale AI projects. In Europe, adoption has been more cautious, though largely due to having different regulations and decarbonisation targets. The pressures are the same, though.  

The technology chosen for the site will depend heavily on the site's profile.  

Open-cycle gas turbines (OCGTs) offer relatively fast deployment and high-power output, making them a good choice when rapid energisation is the goal. However, they are less efficient than other technologies better suited to flexible or transitional operations.  

Reciprocating gas engines are also gaining attention for phased developments. Their modular nature allows incremental capacity addition, and they perform well under part-load conditions. As such, their flexibility can be useful for campuses planning to expand over several years rather than go online all at once.  

Whilst Europe as a whole could benefit from these technologies, the context between the regions is vital. Each country has differing existing gas infrastructure, energy policies, and security measures that affect the viability of on-site generation. In terms of those likely to make the transition first, the UK, Germany, Ireland, Poland, Spain, and the Nordics are front of mind both in terms of demand and viability.  

What is the downside?  

While the commercial case for behind-the-meter generation is strong, its sustainability impacts require careful consideration.  

Gas-fired generation produces direct carbon emissions, and lifecycle emissions associated with extraction and transport remain an important consideration. For operators with ambitious net-zero commitments, there is an obvious tension.  

However, the grid constraints are already affecting how quickly infrastructure can be deployed. In some locations, the alternative is not renewable energy but no energy at all.  

That does not remove the need to reduce emissions. If gas is to play a larger role in supporting data centres, it will need to be combined with other credible decarbonisation strategies. Efficiency improvements will be part of this. Combined-cycle gas turbines (CCGTs) are more efficient than open-cycle gas turbines. However, they come with greater complexities and operational considerations. Alternatively, hybrid strategies using renewable energy and battery storage could also become more common.  

In the longer term, carbon capture and storage may influence how gas generation is deployed within large infrastructure projects. Whilst the widespread adoption is uncertain, some operators are considering future fuel flexibility, including hydrogen compatibility, as part of their long-term strategies.  

Power is a competitive issue

Power availability is becoming one of the defining challenges for this era of data centres.  

For many operators, behind-the-meter generation isn’t a theoretical discussion or emergency measure. It is increasingly seen as a tool to accelerate deployment and create flexibility in constrained markets.  

Whilst more operators are considering this, it doesn’t mean they are abandoning their decarbonisation goals. Instead, operators are recognising that the current grid infrastructure alone can’t meet demand. As such, they are required to adapt their strategies to create capacity and maintain their sustainability commitments where possible.  

To navigate these challenges, operators need flexible power strategies that balance speed, commercial viability, and sustainability objectives. The ability to secure reliable power will give operators a competitive advantage, and those that adapt will be best prepared for the next era of data centre growth.  

Contact one of our data centre specialists to assess whether behind-the-meter generation can accelerate your project while maintaining your decarbonisation strategy.