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ON.Energy says its centralized lithium-ion battery system passed multi-megawatt testing at the National Laboratory of the Rockies. The startup is preparing to deploy the system under a 5-gigawatt order from data center developer Crusoe, though commercial performance and the order’s rollout details remain unclear.
ON.Energy says its centralized battery system for data centers completed multi-megawatt trials at the National Laboratory of the Rockies, clearing a step toward commercial use. The startup is preparing to test the system at scale under a 5-gigawatt order from Crusoe, with the technology designed both to provide backup power to computing facilities and to limit their impact on the electrical grid.
The system, called AI UPS, combines functions of an uninterruptible power supply (UPS) and a grid-scale battery energy storage system. Conventional data center UPS units typically use batteries to keep servers running during brief disruptions, but they generally sit idle until needed. ON.Energy’s approach places a centralized lithium-ion battery system between the grid and the data center, with the aim of conditioning power for the facility while presenting a more controlled electrical load to the grid.
ON.Energy CEO and co-founder Alan Cooper said development took roughly five years. The company says its patented double-conversion design electrically separates the data center’s load from its power source, with inverters responding to changes in power conditions. Cooper said the system needs to be incorporated into a data center’s design; it is not simply a battery package that can be added to any existing site without planning.
The National Laboratory of the Rockies, formerly the National Renewable Energy Laboratory, tested the system in a grid simulator at multi-megawatt configurations, according to the report. Laboratory chief engineer Shahil Shah is also overseeing tests of a similar system from Prevalon Energy. Shah said other companies are developing comparable technologies, though he did not identify them.
Batteries Could Smooth Data Center Loads
Large data centers can place unusual demands on the grid. Their electricity use can change quickly as computing activity shifts, while disturbances in grid power can prompt facilities to disconnect and switch to backup systems. Both patterns can complicate the work of grid operators, who must keep electricity supply and demand balanced.
The report cites incidents recorded by PJM Interconnection, including a July event in which nearly 4 gigawatts of data center load in Virginia disconnected. That figure describes the load involved in that event, not a recurring rate or a measure of ON.Energy’s system. If a battery system can buffer rapid changes and reduce abrupt disconnections, it could help operators manage large new loads while maintaining reliable service. Whether the system delivers those benefits at commercial scale has yet to be established.
The commercial case also matters to data center owners. Batteries that serve only as emergency backup can be difficult to justify if they are expensive and rarely used. ON.Energy says a centralized system could provide additional grid-related services, but the source material does not specify which services will be offered commercially or quantify their financial value.
industrial lithium-ion battery storage system
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From Backup Units to Grid Buffers
Data centers have used UPS batteries for decades to protect servers when utility power flickers or fails. Many traditional systems use lead-acid batteries and work alongside backup generators. Their core role is continuity for the facility, rather than actively managing the facility’s effect on the wider electricity system.
Grid-connected lithium-ion batteries are being developed to take on a broader role. Shah said power system operators are setting requirements intended to prevent large data center loads from harming grid reliability. The issue has grown more pressing as computing facilities expand and their electricity demand increases.
ON.Energy’s laboratory results are a technical milestone, not proof of long-term commercial performance. The next stage is a deployment planned around a Crusoe project. The report says some areas of a campus under construction were designed for traditional UPS equipment, while a newer building has reserved space for the centralized battery system.
“The grid sees a battery that’s always charging, and the load sees a battery that’s always outputting perfect quality power.”
— Alan Cooper, ON.Energy CEO and co-founder
Commercial Results Still Unproven
The reported trials show that ON.Energy’s system was tested at multi-megawatt configurations, but the available information does not provide detailed test results, independent performance metrics or evidence of sustained operation at a live commercial data center. The 5-gigawatt order is reported, but its schedule, number of sites, delivery terms and share of the order expected to use the new system are not specified.
It is also unclear how much the batteries will cost, how often they will provide services beyond backup power, or whether those services will produce enough revenue or savings to make the system attractive to operators. The report does not detail the system’s duration, capacity, efficiency or performance during a major grid disturbance. Those factors will shape its value to both data center owners and grid operators.
Crusoe Deployment Will Test Scale
ON.Energy is preparing to put the system into commercial-scale use at a Crusoe data center project. The next evidence to watch for is when the batteries are installed and begin operating, how much capacity is deployed, and whether the facility and grid operator report measurable performance during real operating conditions.
Further results from the National Laboratory of the Rockies’ testing of Prevalon Energy’s similar system may also show how widely the approach is being pursued. Until operational data and project details are public, the technology’s commercial reach and its effect on grid reliability remain open questions.
Key Questions
What is ON.Energy’s AI UPS?
It is a centralized lithium-ion battery system intended to combine data center backup power with grid-scale energy storage functions. ON.Energy says it is designed to condition power for the facility while making its grid connection more predictable.
Did the system complete testing?
According to the report, ON.Energy completed multi-megawatt trials at the National Laboratory of the Rockies earlier this year. Detailed test results and independent performance metrics were not included in the source material.
What is the 5-gigawatt Crusoe order?
The report identifies it as an order from data center developer Crusoe and says ON.Energy is preparing for commercial-scale testing. It does not explain the order’s delivery schedule, site count or how much of it will use the AI UPS system.
Why could data center batteries help the grid?
They may buffer rapid changes in electricity demand and help prevent facilities from abruptly disconnecting when power conditions change. Those events can complicate grid balancing, but the benefits of ON.Energy’s system at a live commercial site have not yet been reported.
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