The grid connection is too slow, "can't wait," data centers are scrambling to purchase "jet engines" for power generation

Wallstreetcn
2025.12.27 13:18
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Data centers can't wait for 7 years for grid access, so tech giants are turning to aircraft engines and diesel generators for "emergency" power supply. GE Vernova's orders surged by one-third, Cummins doubled its production capacity, and even Boom, which manufactures airplanes, is crossing over to sell power turbines—business that Sam Altman personally called to "request." However, the cost of on-site power generation is twice the average industrial power generation cost, with even higher carbon emissions

Faced with years of waiting for grid access, developers eager to power the AI boom are turning to aircraft engines and fossil fuel generators for solutions.

This trend is reshaping the supply and demand landscape of the power equipment market. According to a recent report by the Financial Times, manufacturers like GE Vernova are reporting a significant increase in orders aimed at bypassing the grid for direct power supply. Even the aviation startup Boom Supersonic is crossing over, planning to fund its jet business with revenue from selling power turbines to data centers.

This shift highlights the urgency among tech giants regarding infrastructure development, as they prefer to bear higher costs rather than wait in line for electricity. Currently, data centers face grid access waiting times of up to 7 years; by directly installing aviation-derived turbines next to data centers, developers can immediately power the training and operation of AI models.

Essentially, it is "aircraft engines," in form "turbines," and in function "power generation." Simply put: data centers are buying aircraft engines (turbines) to use as generators.

Surge in Demand for Aviation-Derived Turbines

GE Vernova is providing aviation-derived turbines to data center developer Crusoe, expected to supply nearly 1 gigawatt (GW) of power for OpenAI, Oracle, and SoftBank's Stargate data center project in Texas.

GE Vernova's Chief Financial Officer Ken Parks told investors last December that the company has seen "growing demand" for its aviation-derived and small gas turbine units, which are supporting data center needs as "bridge power." Data shows that orders for the company's aviation-derived turbines have increased by one-third in the first three quarters of 2025 compared to the previous year.

Another manufacturer, ProEnergy, has sold over 1GW of 50-megawatt gas turbines, which are directly modified from the core of jet engines.

Sam Altman Drives Cross-Industry Players to Enter

Aviation startup Boom Supersonic, backed by Sam Altman, announced a deal to sell turbines to Crusoe that are expected to provide 1.2GW of power, which are "almost identical" to the engines made for its jets.

Boom Supersonic CEO Blake Scholl revealed in an interview that this cross-industry collaboration stemmed from a direct request from Sam Altman. "Three or four years ago, I imagined we would first make planes and then energy," Scholl said, "but then I got a call from Sam Altman, who said, 'Please, please, please, make us something.'" The company currently plans to use the revenue from power turbines to fund its jet business.

Traditional diesel and gas generators are also under scrutiny

In addition to high-end turbines, the use of traditional diesel and gas generators is also on the rise. Manufacturer Cummins has sold over 39GW worth of power equipment to data centers this year, nearly doubling its capacity.

Paulette Carter, Executive Director of Cummins Data Centers, stated that while generators are typically used as backup power, there is now growing interest in "on-site primary power" in the market.

There are also signs of regulatory loosening. U.S. Energy Secretary Chris Wright has suggested requisitioning existing backup generators to bolster the grid. In Virginia, a global data center hub, the Department of Environmental Quality is considering allowing data centers to operate diesel generators more frequently, while the Environmental Protection Agency (EPA) has indicated that data centers can use engines to maintain power stability.

High economic and environmental costs

Although this "on-site power" model can address urgent needs, analysis shows that its electricity costs are about twice the industrial average, and concerns have been raised about increased carbon emissions due to lower efficiency.

Kasparas Spokas, Director of the Power Project at the climate change organization "Clean Air Task Force," pointed out that the current incentives for any technology that can provide power are unprecedented.

However, the efficiency of small power sources is often lower than that of the grid. Mark Dyson, Managing Director of Power at the Rocky Mountain Institute, warned that data centers powered by on-site fossil fuel generation have worse emissions in almost all cases compared to grid power sourced from efficient gas generators and renewable energy

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