What will power the grid in 2035? The competition is open

AI is insufficient energy demand they have technology companies searching for new sources of energy – a search that has fueled competition and investment in mergers and disruptive startups.

For many, natural gas is the easiest solution for 24/7, basic energy. Tested, affordable, and available everywhere. But the war in the Middle East has revealed its vulnerable nature after Iranian drone strikes took out a large portion of natural gas supplies from Qatar, a major exporter. At the same time, increased demand has created a waiting list for gas turbines so long that today’s plans may not be completed until the early 2030s.

These delays not only pose a risk to the technology industry, but also to the natural gas industry itself.

In the US, 40% of gas used today goes to power generation. As the shortage of turbines ends, the industry may have new competitors. All small nuclear reactor (SMR) developers and integrated power plants are planning to start connecting their power plants to the grid in the next five to seven years, about the time it takes to find parts of a new natural gas plant.

Nuclear threat

SMR initiators may have a better shot at eliminating natural light sources. Often, technology changes the design of existing fission reactors, but the basic physics has been proven and widely used over the years.

Several SMR companies want to have reactors up and running before the end of the decade. Kairos Power, which counts Google as a future client, is one of them. The company received approval due to its presentation of Hermes 2 in 2024, and the construction work is it’s going well. Okay, where including and Sam Altman’s blank check company in 2024, is targeting 2028 for its first commercial operations, according to annual report.

Others hope to follow suit a few years later. X-force, that is counts Amazon as an investorand the purpose of early 2030swhen Bill Gates founded TerraPower, which has a dealing with Metais planning to start commercial operations in 2030.

Displacing natural gas as a source of choice, SMRs will need to grow rapidly, realizing the economic scale that their businesses depend on. That it won’t be easy. But the tech industry seems confident enough that it is possible investing in startups or sign gigawatt power contracts with them.

Fusion time

Some tech companies are warming up to the power of fusion. Although not as reliable as fission, nuclear fusion promises to provide more energy using ocean water as fuel.

Fusion developers are also looking at the early 2030s – or sooner – to deploy their first reactors. The power of fusion

One of the leading ones, Commonwealth Fusion Systems, is on the road to open the switch at its next year’s exhibition. Its first commercial generator, the 400-megawatt Arc, is expected to begin generating power in Virginia in the early 2030s.

Another founder, a relative newcomer, hopes start building on grid power plants in 2030. Inertia Enterprises has based its technology on the design of the reactor used by the National Ignition Facility, which was the first to prove that nuclear control systems can produce more energy than they consume.

But Helion may have the scariest time of them all. The Sam Altman-backed startup is rush to build Orionits first power plant, by 2028 to provide electricity to Microsoft. So does the company is said to be in talks with OpenAI to provide 5 gigawatts by 2030 and 50 gigawatts by 2035. To break these figures, Helion must build 800 reactors by the end of the decade and another 7,200 five years later.

If the startup can provide power in these quantities, it could rewrite the electricity market. Last year, the US added 63 gigawatts of new energy production in all areas. If Helion can build close to 10 gigawatts of new capacity each year, the company alone would add more capacity than the entire natural gas industry did last year.

The price problem

The problem for all these companies – including gas turbine manufacturers – is cost.

Developers of SMRs are relying on mass production to keep costs down, but that idea has yet to be proven. Today, nuclear power is one of the most expensive renewable energy sources at about $170 per megawatt hour, according to Lazard. Fusion is facing similar growth challenges, although it is facing unknowns. Some experts predict that one megawatt hour from the power plant could flow about $150 at first.

A new gas-fired power plant, meanwhile, costs about $107 per megawatt hour, according to Lazard, although prices have been rising in recent years, possibly putting it on a collision course with new fission and fusion reactors.

But all of them can be reduced by the extras included with the batteries.

The cost of wind and solar power has fallen dramatically over the past decade. Wind power appears to have peaked in recent years, but solar prices continue to decline with no signs of stopping. Batteries, too, have become cheaper over the years, to the point where grids are putting more of them – 58 gigawatt-hours last year. Even without subsidies, combined solar and batteries range from $50 to $130 per megawatt hour, combining fusion, fission, and natural gas.

All of the figures contain the latest battery technology from the chemistries for electric vehicles. New designs that focus more on grid connections can lower prices. Form Energy, for example, recently signed a contract to power Google from a 30-gigawatt-hour steel battery. Another, XL Batteries, can refurbishing old fuel tanks keeping its fluid low-cost – the size of the battery depends only on the size and volume of the tanks.

Because these new batteries avoid the use of essential minerals such as lithium, cobalt, or nickel, they promise to reduce the cost of long-term energy storage so much that it’s hard to argue against anything else.