The market is digesting the new template: data centers must be curtailable. It is the only way to stop the staggering costs of connecting massive new loads and building fresh infrastructure from cascading down to everyday ratepayers. My forecast is flexibility is about to become a priced, and potentially, tradable thing. You will see it play out at every layer.
Residential homes and commercial buildings will install more batteries simply to defend themselves when rates spike.
Data center workloads will be forced to flex by throttling operations or shifting compute if marginal revenue of a token is < marginal cost of producing a token.
To survive grid curtailments, more onsite BESS and gas islands to power their facilities will be built, all while utilities lean heavily on grid contractual flex through non-firm services.
But among all, the biggest potential change to the power market might be a physical rewiring of the hardware itself. NVIDIAâs 800V DC architecture and its software control layer, DSX Flex. I am slowly reckoning this change is much more fundamental than just a rack level design update. I can see how this turns the data center site itself into a natively storage integrated, software controlled microgrid. That physical transformation will finally turns the âpower blockâ into a standardized, financeable infrastructure asset.
Hear me out. If you draw out a typical legacy power routing, youâll notice it is embarrassingly inefficient: voltage step down, AC to DC, back to AC, back to DC. NVIDIAâs 800VDC design removes those intermediate steps by converting 13.8kV AC grid power straight to DC at the site perimeter. This delivers 85% more power through the same conductor size at row level busways (rows of metal bars with power cables) and use 45% less copper than standard 415V AC distribution, plus 5% end to end efficiency gain over todayâs 54V standard. It is not about saving copper. It is about saving space in the racks to host more GPUs.
Down at the server, the Kyber rack uses a converter to step 800VDC straight down to 12VDC right next to the GPU, 26% less physical area than current conversion. Full scale 800VDC production lines up with Kyber rack-scale systems in 2027, which means if youâre designing the power system on a legacy AC standard today, youâre staring down a retrofit question.
Because the architecture is natively DC, storage moves inside at a few places. In-rack batteries smoothing the GPUsâ violent power transients. Hall level batteries hung directly on the DC bus, zero inverters needed, to further smooth the load swings. Site level battery and generation for true islanding and backup.
DSX Flex is the brain. It takes grid signals (load shedding, demand response, pricing) and throttles workloads in response, orchestrating power across utility supply, on-site generation, and storage. The pilot results suggest up to 70% of power load can be flexed and grid-following. This can rewrite how power trading is done today.
So how does this potentially impact the power system supply chain? Winners are anything touching MV-to-DC conversion â solid-state transformers, SiC/GaN semis (Analog Devices, AOS, EPC, Infineon, Innoscience, MPS, Navitas, onsemi, Power Integrations, STMicroelectronics, Texas Instruments), DC-native battery storage, MV switchgear. Losers: low-voltage AC PDUs, double-conversion UPS. DC work is a lot riskier, and the workforce trained to commission this architecture doesnât exist at scale yet.
But itâs an exciting time. When the design stabilizes, offsite manufacturing and assembly gain a massive advantage. The modularized power block can become a repeatable, standardized kit instead of bespoke engineering services. And the power blocks become financeable and leasable! A âpower block as a serviceâ owner will sit between the utility and the compute tenant, financing the power infrastructure while the tenant just leases capacity. Hooray!
Everything is changing so fast. If youâre like me, you feel both excited and a little overwhelmed. Iâll share a quote from my coworker this week: âI am an intense guy. I thrive on intensity.â
PS: If you enjoyed this, share it with a colleague or friend who might too. And if you want to chat, Iâm at meng@fridaymorninglabs.com