Building a modern data center is only getting harder. Between tighter timelines, stretched supply chains, limited land availability, and complex permitting requirements, developers have their work cut out for them. Phased power delivery, temporary energy solutions, and more proactive logistical planning are becoming essential strategies to get facilities up and running faster with minimal risk. Let’s dig into construction hurdles plaguing data centers – and strategies for overcoming them.
Increasing Congestion, Worsening Delays
Energy not only determines where data centers get built – it also determines how fast they can come online. Unprecedented grid congestion has become one of the biggest bottlenecks in modern data center development. According to a recent Data Center Frontier survey, a stunning 92% of senior data center professionals identified grid constraints as the most significant obstacle slowing data center projects, with 44% reporting average utility wait times of four years or more.
The data supports this escalation. The IEA reported this year that about 20% of planned data center projects are at risk of significant delays, with interconnection wait times stretching as long as a decade in some regions.
Because of these constraints, 61% of data center professionals said they’re now selecting sites primarily based on where power is immediately available, according to the Data Center Frontier survey. This shift emphasizes the increasing importance of proactive planning that takes into consideration long-term power needs, local energy infrastructure, and redundancy options.
Phased Power and the New Onsite Energy Paradigm
To overcome the gridlock, developers are increasingly turning to phased power delivery – bringing power and capacity online incrementally throughout the build cycle. Along with less upfront costs, this ramp-up approach enables faster deployments that alleviate grid strain and improve long-term scalability.
Phased approaches often take advantage of temporary on-site power solutions like generators and fuel planning to ensure that new builds can begin operations while permanent utility connections are finalized. Data Center Frontier reported that six in ten data center professionals said on-site generation was their preferred contingency strategy when utility power is not available on time.
But on-site power isn’t just a temporary or contingency solution, it’s increasingly becoming a permanent fixture of modern data center facilities. According to Bloom Energy’s mid-year power report, by 2030, 38% of facilities are expected to use some on-site generation for primary power, while 27% are expected to be fully powered by on-site generation. Key types of on-site power include wind, solar, hydrogen fuel cells, small modular reactors, and natural gas generators.
Natural gas turbines in particular are proving to be a popular – and reliable – solution in the face of the growing risks of grid instability, power supply intermittency, and extreme weather. A number of massive AI data centers are currently using gas turbines to power their operations, including xAI, Stargate, and Prometheus Hyperscale. While less efficient and high maintenance, their rapid deployment is what’s attracting operators in droves.
Permitting and Regulatory Complexities
That said, there are several permitting and regulatory hurdles to these on-site power approaches. The permitting process is often long – ranging from months to years – and unpredictable. It takes more than two years to complete an environmental impact statement. At the same time, over the past year, state-level restrictions have more than doubled, contested projects have grown 29%, and local restrictions on renewable projects have grown by 73%, according to research by Deloitte.