Behind-the-Meter Report: 2026 Outlook

Mehrbano Asim
Apr 8
2 min read

For decades, data center site selection has been a binary choice: finding the perfect site entailed a reasonably sized parcel of land, fiber connectivity, and a utility that has the capacity needed. However, in more recent years, we are seeing an increasing difficulty in power procurement. In comparison to previous years, where utility growth almost felt stagnant, the data center market has caused a boom where more growth is seen year over year than in previous decades. This has caused serious shifts in the market, where a transition towards grid independence is taking place in real time.

Data center developers are trying to reshape dynamics, where they are no longer passive consumers of power, but are part of active and autonomous energy ecosystems. Ultimately, data centers are changing market dynamics to fit their urgent needs for ‘speed to market’. The seismic shift in data center infrastructure enables developers to bypass traditional grid constraints in favor of decentralized power solutions.

The introduction of Behind the Meter (BTM) power has defined a new era of data center development. Reducing overall grid dependence, and increasing power deliverability. On-site power allows developers to avoid passing through a utility meter altogether, ensuring that their needs are being met without having to wait in long queues. Moving from niche sustainability goals to core operational requirements, on-site power and BTM solutions now account for over 25% of all new data center capacity. Developers are able to leverage power in the form of solar, wind, natural gas, hydroelectric and tidal power, as well as nuclear, hydrogen fuel cells, and small modular reactors (SMRs). These alternative pathways to power may allow developers to leverage their geospatial intelligence and decide which power source is a good fit, but managing permitting, timelines, operational requirements and upfront costs might be the hardest part.

As interconnection congestion increases, a market migration towards regions that provide more energy sovereignty can be seen. Traditional hubs such as Northern Virginia face community walls and high levels of interconnection delays, prompting developers to move to markets where behind the meter power is the primary driver of data center growth.