DATA CENTRES
The AI power reckoning driving the shift to high-density DC architecture
By Meir Adest, Co-Founder and VP core technologies, SolarEdge T
he rapid growth of AI is driving a surge in data centre energy demand, pushing grid capacity and traditional electrical
infrastructure to their limits Artificial intelligence is reshaping the data centre landscape at extraordinary speed. Hyperscale operators are racing to deploy infrastructure capable of supporting increasingly power-hungry workloads, with more than 100GW of new AI data centre capacity expected globally between 2026 and 2030. At the heart of this shift is a fundamental change in compute density. Traditional server racks typically operate at around 10kW. Today, AI racks are approaching 1MW, representing a two orders of magnitude increase in power demand within the same physical footprint. This escalation is exposing a critical constraint that has, until now, remained largely invisible: the limitations of the underlying energy architecture in sustaining future demand.
THE LIMITATIONS OF AC INFRASTRUCTURE
Despite the digital nature of modern computing, the energy systems powering data centres remain rooted in a model developed more than a century ago. Alternating current (AC) became the standard because it enabled efficient long-distance transmission at a time when direct current (DC) could not. However, every core component inside a data
centre, from GPUs to batteries, fundamentally operates on DC power. As a result, today’s infrastructure relies on a continuous cycle of conversions: AC from the grid is stepped down, converted to DC for storage, inverted back to AC for distribution, and finally converted again to DC at the chip level.
This process introduces a ‘conversion tax’, between 10 per cent and 30 per cent of incoming energy can be lost before it ever reaches the compute load. Crucially, these losses create a double penalty - this valuable energy is lost as heat, meaning this heat must then be actively removed with cooling systems, requiring additional energy consumption. In an era where power availability is becoming a limiting factor for data centre expansion, every percentage point of efficiency matters. Each incremental loss represents not only reduced compute capacity from a fixed grid connection, but also substantial financial impact at scale. Across
gigawatt-class facilities, even a single percentage point of inefficiency can translate into millions in lost value, reinforcing the need to maximise the proportion of energy that reaches the processors themselves.
WHY AI IS FORCING A MOVE TO DC Historically, these inefficiencies were tolerable. Rack densities were low enough that energy losses could be absorbed without fundamentally constraining performance, but AI changes this. With racks approaching megawatt scale, the
physical and thermal limits of AC infrastructure are being reached. NVIDIA and other technology leaders are now advocating for 800V DC architectures as the only viable path to support megawatt-scale racks. The rationale is straightforward. Higher voltage DC systems enable lower current for the same power delivery, reducing resistive losses and allowing significantly more power to be transmitted through existing conductors. In practical terms, 800V DC can deliver substantially more power while reducing copper usage, installation complexity and cost. However, implementing this requires a fundamental redesign of how energy is delivered within the data centre.
MAPPING THE TRANSITION FROM AC TO DC
The transition to DC-native architecture is not a single step, but a staged evolution. Today, most data centres operate in what can be described as Stage zero, where power is distributed entirely in AC, with DC conversion only occurring at the point of use. Stage one introduces targeted improvements through retrofits such as sidecar solutions, enabling the introduction of 800V DC racks, and resulting in 85 to 93 per cent system efficiency. While valuable, these approaches are widely viewed as interim measures. A more significant shift occurs with Stage two, where elements of the infrastructure, mainly the UPS systems, begin to operate on DC. This hybrid approach removes unnecessary conversions, so system efficiency can increase to 91 to 96 per cent. The real shift begins at Stage three, where data centres become fundamentally DC-native. Here, traditional transformers are replaced by solid-state transformers that convert medium voltage AC directly to DC. This simplifies the power chain and unlocks efficiency of 94 to 97 per cent.
36 September/October 2026 Irish Manufacturing
www.irish-manufacturing.com
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