ERCOT’s power grid is facing an energy inflection point—one that has a huge impact on Texas’ data centers.
Texas leads the nation in data center expansion. That growth, however, brings new pressure from regulators, utilities, and local communities to manage large energy loads responsibly.
Texas’ peak demand is projected to rise from 87 gigawatts in 2025 to 138 gigawatts by 2030, an increase of nearly 60%.
Starting in 2026, Senate Bill 6 (SB-6) will require new facilities drawing more than 75 megawatts from the grid to curtail load during emergency events–introducing potential new risks to uptime, power quality, and thermal stability.
For decision makers at Texas data centers, battery energy storage now represents the most effective way to strengthen reliability, manage energy during peak demand periods, and minimize any negative impacts from mandatory or voluntary curtailment.
Without on-site storage, data centers are fully exposed to:
- ERCOT curtailment orders under SB-6 and potential uptime disruptions
- Volatile energy prices and demand charges during peak hours
- Interconnection delays or capacity limitations due to grid congestion
- Power quality issues from voltage fluctuations or sudden grid events
- Community and regulatory scrutiny around grid strain and emissions
Energy storage changes the equation by giving operators control over when and how they use grid power—without sacrificing five-nines commitments or tenant satisfaction.
Energy Storage and Data Centers: Supporting Reliability and Compliance
Energy storage systems allow electricity to be stored—and then discharged—at the most strategic times. Today, Lithium-ion batteries, the same batteries that are used in cell phones and electric vehicles, are the most commonly used type of energy storage. Like the batteries in your cell phone, industrial-scale battery energy storage systems can be charged with electricity from the grid, stored, and discharged when there is a deficit in supply or when energy is most expensive.
Adding a battery storage system allows your data center to:
🔓 Unlock and accelerate capacity for new developments or site expansions while easing interconnection approvals by reducing grid strain during peak demand
✅ Comply with curtailment events under SB-6 by relying on stored energy during grid stress to either meet curtailment obligations or transition over to backup generators
🔌 Maintain power quality and uptime through ride-through support, ramp-rate smoothing, and seamless bridging during grid outages or switchovers
💪 Enhance power performance by stabilizing nonlinear loads
⬇️ Reduce peak energy costs by storing electricity when it’s inexpensive and discharging when prices surge
💰 Pass savings to tenants or retain them internally to strengthen competitiveness
Battery storage allows facilities to store electricity and dispatch it when demand is highest, turning a potential cost into a strategic advantage. Unlike diesel backup generators, battery storage works continuously, optimizing daily energy use, not just responding to emergencies.
The Case for Acting Now
SB-6 enforcement begins in 2026, and ERCOT’s interconnection queue is already full. Battery storage projects require design, permitting, and grid studies—so early planning delivers better economics and reliability outcomes.
Waiting too long can mean higher costs, longer timelines, and reduced flexibility to meet compliance requirements or secure optimal interconnection terms. Data centers that act now will be positioned to lock in savings before battery prices rise as a result of FEOC, ensure operational readiness, and avoid getting caught in the next wave of grid congestion.
Facilities that act now won’t just comply with SB-6—they’ll lead the next generation of resilient, grid-ready data centers in Texas.
Types of Battery Storage Partnership Models
Every data center has unique energy and reliability needs, but all share the same requirement: continuous, uninterrupted operations. Battery storage systems are designed to integrate seamlessly with existing infrastructure, delivering energy savings and resilience without disrupting day-to-day performance.
Data centers can choose the battery storage contract model that best fits their financial and operational goals.
1. Lease Model
The battery storage system is owned and operated by a third party -who pays you a fixed monthly price to site a battery on your site. Your facility retains all savings and benefits from lower energy costs and improved reliability without capital investment, maintenance responsibilities, or operational impact.
2. Shared Savings Model
Similar to the lease model, the battery is owned and operated by a third party, with whom you share the savings the battery generates. In this model, value is typically fully passed or at least partially passed to your tenants, aimed at improving tenant satisfaction and retention.
3. Tolling Agreement
Your team manages the battery storage system and determines how and when stored energy is used, capturing full financial and operational value while maintaining uptime and system stability. Oftentimes, tolling agreements are favored by data centers looking to gain capacity from utilities and grid providers.
All three approaches can be customized to align with your site’s specific priorities and long-term energy strategy.
Convergent Energy and Power: Proven Battery Storage Expertise
Now is the time for Texas’ data centers to capitalize on the challenges facing the electric grid in ERCOT and take control of their energy future—and energy costs.
For over a decade, Convergent Energy and Power (Convergent) has gained deep expertise by working closely with industrial businesses to take the hassle out of on-site renewable solutions by building, owning, and operating systems on our customers’ behalf. We’ve been developing battery storage systems for ~15 years, and have been around as long as the battery storage sector itself.
If you’re looking to future-proof your facility with an on-site battery storage system, schedule a free, no-obligation introductory call with our team today.