Every developer can recite the generation queue numbers by now. The queue of projects waiting for a grid connection peaked near 2,600 GW at the end of 2023. It has fallen for two straight years and stood at more than 2,060 GW at the end of 2025. [1] That is not because connections got faster. More projects dropped out than joined: over 750 GW withdrew in 2025, against about 600 GW of new requests. [1] The typical project built in 2025 took more than five years to get from interconnection request to commercial operation. [1] The diagnosis is familiar, but the response has changed. A meaningful share of the industry no longer treats grid access as a problem to solve. It's now approached as a constraint to route around, with generation built on the customer's side of the meter.

Behind-the-Meter Deal Flow: Bloom Energy, Prometheus Hyperscale, International Electric Power

The hedge has become a primary development strategy, and the deal flow shows it. Brookfield has raised its framework to finance Bloom Energy's on-site fuel cells for AI infrastructure fivefold, from $5 billion announced in October 2025 to $25 billion. [2] The partnership is part of Brookfield's dedicated AI infrastructure fund, which launched in November 2025 with a target of $100 billion. [2] Data center developer Prometheus Hyperscale is working with power producer Conduit Power on gas generators and batteries that could scale to 300 MW at each of two Texas data centers. [3] Conduit describes them as bridge and backup power, and the sites will use existing grid interconnection capacity. [3][4] Power developer International Electric Power (IEP) is planning a 944 MW gas plant in Pennsylvania to power a data center, with battery storage and backup from an existing grid interconnection. [5] The common thread is not independence from the grid, but speed. Developers are building generation they control so the data center can start operating before the utility can serve it.

Core U.S. Markets Are Full, and Power Is the Reason

The mismatch is measurable. Bloom Energy's 2026 Data Center Power Report surveyed 152 industry decision-makers in November 2025. [6] It found that utilities' projected delivery timelines run about 1.5–2 years longer than hyperscalers and colocation providers expect. [6] Bloom sells on-site power, so read the survey as one vendor's view of the market. CBRE, a commercial real estate firm, sees the same strain in its tracking. In 2025, capacity under construction in primary U.S. markets fell for the first time since 2020, to 5.9 GW from 6.3 GW. [7] Many planned projects were delayed by permitting, zoning, and power procurement hurdles. [7] Northern Virginia's pipeline fell 29%. [7] Construction across primary markets then rebounded in the first half of 2026 to a record 7,481 MW. [8] Even so, vacancy in primary North American markets fell to a record low of 1.4%, and 80.4% of what is under construction is already preleased. [8] Power, not demand, is the constraint, and that is the opening for behind-the-meter generation.

Transformer Lead Times vs. Behind-the-Meter Build Speed

The equipment math explains why on-site generation can win that trade even before interconnection enters the picture. According to Wood Mackenzie analyst Ben Boucher, generator step-up transformer lead times had passed 160 weeks (more than three years) by early 2026, up from an average of 143 weeks in 2024. [9] PTR, an industry analyst firm, says lead times for large power transformers now stretch well beyond 24 months in most major markets. [10] When the alternative to waiting on the grid is waiting on that equipment, a smaller on-site plant can be the faster option.

Comparing On-Site Generation Technologies for Hyperscale Load

Several technologies compete to power data centers on site. Cleanview, a market intelligence firm, tracks 59 behind-the-meter data centers with about 90 GW of planned self-generation. By permitted capacity, Caterpillar's engines and Solar Turbines hold 33% of the equipment it tracks, GE Vernova 32%, and Bloom Energy's fuel cells 14%. [11] Conduit Power, for example, bought 250 MW of engine-generator sets in November 2025 for data center deployments in 2027. [12] Recent orders include 412 MW of Wärtsilä engines for a hyperscale project in Ohio and 13 PROENERGY aeroderivative turbine sets of 50 MW each for AI infrastructure company Crusoe. [13]

Turbine manufacturers are booked years in advance, adding to project timelines. Photo: Image-Source/Envato Elements

Developers can match the choice to site constraints, fuel availability, and emissions posture. Renewables plus storage remain a harder fit for a primary on-site plant. Energy software firm Enverus argues that pairing them to meet 24/7, high-density AI load is still cost-prohibitive for most developers today, while gas turbines and reciprocating engines deliver continuous, dispatchable power on timelines short enough to matter. [14] Many hyperscalers frame gas as a bridge fuel until grid power is available. [14]

The Next Supply Chain Risk: Gas Turbines

But behind-the-meter is not a clean escape from supply chain risk. Heavy-duty gas turbines are the clearest example. GE Vernova's gas equipment backlog and slot reservations reached 116 GW at the end of the second quarter. [15] About 53 GW of that is firm backlog, and 63 GW is slot reservations that have not yet converted to firm orders. [15] Turbine makers are booking reservations four to five years out. [16] That is why only one of the 59 projects Cleanview reviewed plans to use heavy-duty turbines on site. [11] Developers rely instead on aeroderivative turbines, reciprocating engines, and fuel cells, and those supply chains are tightening too. Bloom Energy makes about 1 GW of fuel cells a year and plans to reach 2 GW by the end of 2026, and Cleanview notes that Caterpillar's reciprocating engines have never been deployed at the scale some of these projects envision. [11] The market has correctly identified that grid interconnection is the binding constraint on power delivery. It has yet to fully absorb that behind-the-meter generation substitutes one equipment queue for another. It is a better queue, on current numbers, but not an infinite one.

Gas turbine backlogs are becoming the next timeline risk for on-site power. Photo: Image-Source/Envato Elements

Colocation Capacity, Pre-leasing, and the Load Growth Curve

The market backdrop shows how quickly this has become mainstream. A midyear 2026 report from real estate services firm JLL counts 66 GW of data center capacity under construction in North America. [17] About 95% of it is pre-committed, and vacancy has held at 1% for the third year running. [17] Commitments on that scale only make sense if tenants are confident that power will arrive, which can mean on-site generation is built into the deal and not bolted on after a permitting setback. Berkeley Lab's load projections, the latest available, show U.S. data center electricity use rising from 176 terawatt-hours (TWh) in 2023 to between 325 and 580 TWh by 2028. [18] JLL separately projects nearly 100 GW of new data center capacity worldwide between 2026 and 2030. [19] It is hard to see a transmission build-out absorbing that curve on the timeline the load is arriving. Behind-the-meter generation is the industry's answer to that gap.

Permitting Risk: What Ireland Signals for U.S. Regulators

The permitting risk on these plants is more specific and arrives earlier, and most of this capacity is still on paper. Of the roughly 90 GW Cleanview tracks, only about 2 GW is operating, and 60% has only been announced. [11] Gas-fired plants face air-quality permitting like any other combustion source, and that review runs on its own clock, independent of equipment delivery. In New Jersey, for example, AI cloud company Nebius has struggled to obtain an air permit for a 400 MW on-site gas plant. New Mexico blocked a gas pipeline planned to fuel Project Jupiter, a 2.45 GW data center campus that is part of OpenAI's Stargate program. [11] The pipeline's in-service date has now moved to February 1, 2027. [20] A state decision on a separate air permit for the campus's fuel cells is due November 23. [20] Oracle, the campus's main tenant, sent the developer a force majeure notice in September. [20] It would let Oracle delay payments if the campus misses its 2028 target, though Oracle says the project remains on schedule. [20]

Rules vary by state: Ohio created a 45-day fast-track approval for behind-the-meter generation. [11] Ireland offers a preview of where regulation could go. Its energy regulator now requires any data center of 10 megavolt-amperes (MVA) or more to bring its own power capacity, generation or storage located on-site or nearby, that matches the most power the facility is permitted to draw from the grid. [21] That capacity must also be dispatchable, meaning it can be switched on when needed, and it must participate in the wholesale electricity market. [21] That is the opposite of today's U.S. dynamic, where on-site generation is mostly a developer's choice to route around the grid. If more regulators make it a condition of grid connection, the economics for every project in that jurisdiction change.

Owning vs. Contracting: How These Power Deals Get Financed

Ownership structure is the other variable worth separating out, because “behind the meter” describes where the generation connects, not who owns it. Some of this generation sits on a hyperscaler's own balance sheet. Several of the largest projects do not. Natural gas infrastructure company Williams is building and operating gas plants for Meta in Ohio under a 10-year energy service agreement, and power provider VoltaGrid supplies the infrastructure. [11] Independent power producers (IPPs) and equipment vendors build and operate such projects, then sell the output back to the campus under a long-term power agreement. That is closer to how a conventional IPP relationship works than to a corporate power purchase agreement (PPA) for renewables. It matters for how the deals are financed and who holds the fuel-price and equipment-delivery risk. A developer evaluating a site today is weighing gas against the grid, and also whether to own the plant, contract for its output, or do some combination of both. That decision can determine whether the project clears financing.

TerraPower, Meta, and the 2030s Nuclear Alternative

The next horizon past gas is visible, if not yet at real capacity. Oklo, an advanced nuclear developer, says its order book could reach about 18 GW. [22] Much of it is in non-binding agreements, including a 12 GW master power agreement with data center operator Switch. [22] Meta's January 2026 agreement with TerraPower, another advanced nuclear developer, supports early development of two Natrium reactors. [23] They could provide 690 MW of firm power, with delivery as early as 2032. [23] The deal also gives Meta rights to energy from up to six more units, for as much as 2.1 GW, targeted for 2035. [23] That is a 2030s solution, arriving years after the gap it is meant to close. It is why gas, with its shorter deployment window for smaller units and its own tightening backlog, occupies the position it does.