Crusoe’s latest deal targets power electronics for grid reliability

AI infrastructure company Crusoe is partnering with ON.energy to install five gigawatts of backup power equipment at its data center campuses, including its Stargate site in Abilene, Texas. The equipment, called a UPS (uninterruptible power system), sits between a data center and the power grid and acts as a buffer, smoothing out the huge, rapid swings in electricity demand that AI computing creates.

This matters for grid reliability because data centers training AI models ramp their power draw up and down in sudden bursts, which can stress the grid. Worse, when there's a voltage problem, data centers can suddenly disconnect entirely, which drops a large amount of demand all at once and can damage grid equipment. This already happened in Virginia in February 2025, when a power line problem caused 40 data centers drawing about 2 gigawatts to switch to backup power simultaneously. Incidents like this led a national grid reliability organization to issue a rare warning in May about the risks data centers pose to the power system.

The new equipment is designed to prevent these swings and sudden disconnections from reaching the grid, and it's built to meet new rules from the Texas grid operator requiring large power users to "ride through" disturbances rather than dropping offline. For homeowners, this kind of technology doesn't change your utility bill directly, but it's part of a broader effort to keep the grid stable as data centers add unprecedented amounts of new electricity demand in many regions.