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Executives, trade and labor associations comment on Trump's reciprocal duties
U.S. president Donald Trump announced on Wednesday that he will impose a baseline 10% tariff on all imports into the United States, and higher duties for some of the biggest trading partners. This could escalate a global trade war and upset the global economy. The latest responses from business executives, unions and trade associations. Companies On Holding We've noted the tariffs announced and we are continually monitoring the changing situation and policy changes. "Our global value chain and supply chain is well-positioned." GERMANY'S FRESENIUS "We... strongly support the proposal to exclude pharmaceuticals from the reciprocal tariff, as such a tariff could potentially lead to shortages of important medicines for American patients." STEEL GROUP APERAM We will examine the feasibility of moving some of our production to the U.S. if we are able to export limited quantities from the EU. The current lack of predictability in regulatory matters creates a hostile business environment both on the US and European sides. STELLANTIS The automaker announced that it would temporarily stop production in some of its Canadian assembly plants and Mexican assembly factories, including its Windsor assembly facility in Canada. ANTONIO BARAVALLE is the CEO of LAVAZZA We had planned to increase the local production (in the U.S.A.) by 100%. "We're ready to go... but there's this other element to investigate, the duties for Brasil... If they put 10% on Brazil, then the duty (of 20%) is already half. The coffee maker produces about 50% of the amount it sells locally in the U.S. FERRARI The purchase contracts for Ferraris contain standard and clear clauses that allow the company to adjust the price in the event of a change in the market conditions before the vehicle is delivered. A Ferrari spokesperson confirmed that new tariffs would also be applied to Ferrari cars that were ordered in the past but have not yet been delivered to the U.S. MOTOFUMI SHITARA, CEO, YAMAHA MOTOR "Our exports will certainly be affected." We will have to raise prices or reduce costs if these tariffs are extended over time, even for vehicles. MAERSK "We expect our customers to be more careful about their stock levels." We're likely going to see some air freight rush orders in the U.S. very soon, before the tariffs go into effect. We will also see a rise in the demand for bonded warehouses as customers want to delay clearing their goods until they have more certainty." GERRESHEIMER Tariffs are affecting primarily our exports to the U.S. from our Mexico-based plant. Injection vials are one example. We will pass on these customs fees to our customers as an additional cost. We will be able, if necessary and if customs duties remain in place for a longer period of time, to move our capacities." MASSIMO BATTAINI is the CEO of PRYSMIAN The announcement seems to have had a positive effect on the local production. The tariffs are applied to the finished products and removes any risk of U.S. producers being undercut by foreign production. ANDERS VINDEGG HEAD OF MEDIA RELATIONS, HYDRO "We work actively from Norway as well as in Brussels, the EU to inform and work actively with organisations and other initiatives that we are a part of in order to leverage the importance Norwegian aluminium for Europe." ASSOCIATIONS IPC, A Global Association for Electronics Manufacturing "We are pleased with President Trump's focus on revitalizing American defense industry, and his commitment to strengthen American manufacturing. Tariffs won't achieve this goal...Trade essential for supply-chain resilience and innovation. Tariffs will only increase costs and drive production overseas. RETAIL INDUSTRY LEADER ASSOCIATION The President's plan will not only hit the budget of every family, but also American innovation and national security. These newly announced tariffs - and the anticipated retaliatory duties on American businesses - risk destabilizing U.S. economic growth and manufacturing. EUROCOMMERCE, EUROPEAN RETAIL INDUSTRY BODGE "EuroCommerce urges the EU and U.S. Administrations to engage constructively in dialogue. In the event that negotiations fail, EU can use its legal authority to take action against unfair trade practices by a third country. The EU has a wide range of tools to help it address the situation. International Apparel Federation The announcement by the U.S. Government of high taxes on trade with the rest is a shock to the global apparel industry. This unnecessarily creates an entirely new, often irrational world that affects billions of dollars in investments and the lives and livelihoods of tens and millions of people who work in our industry worldwide. Someone will pay the price at some point." CANADIAN STEEL ASSOCATION To reduce its dependence, the Canadian Steel Industry urgently needs the adoption of border measures to address unfair trade in steel in Canada, and help recapture the Canadian Market for our industry, workers, and communities. The Spanish Association of Olive Oil Exporters This 20% is a serious disadvantage for the Spanish olive oil industry, as compared to other countries that produce olive oil but do not belong to the European Union. "98% (of the olive oil consumed by Americans) is imported, so these tariffs would result in an increased purchase price which will be paid by U.S. consumers." consumers." KEVIN C RAVEN, CEO of ADS GROUP on AEROSPACE COMPONENTS We are not sure if the exemption from all tariffs (on items classified as airworthy by regulators) is still in place and if these tariffs are applicable or not. This could make the situation worse. COPA-COGECA EU FARMING GROUPS The introduction of additional tariffs could disrupt global supply chains and drive up prices. It would also limit the market access of farmers and agricooperatives from both sides of Atlantic. This will have significant economic implications for the agricultural industry. ANTHONY BRUN, HEAD OF FRENCH GROWERS ASSOCIATION (UGVC) "One might have been frightened by much higher tariffs. However, this risk remains and is associated with a possible conflict over bourbon whisky. Already, we face tariffs from China. Now, there is the U.S. and the consequences are going to be brutal for wine growers. SIGRID de VRIES, Director General, European Automobile Manufacturers' Association "We urge both leaders to meet immediately to find a resolution to any issues that prevent free and fair trading between historical allies, and to allow the EU-US relations to flourish again." SWISS BUSINESS GROUP ECONOMISSE "We must prevent a further escalation in the trade conflict. Swiss economic diplomacy and the Federal Council are urged to find quick solutions with the U.S. Government at the negotiation table. "From an economic perspective, the U.S. tariffs on Switzerland are not comprehensible - rather the opposite." DIRK JANDURA HEAD OF GERMANY EXPORTERS ASSOCIATION (BGA) "We'll have to pass on these tariffs as price increases and this will impact turnover in many instances." It is an economic dead end that will result in welfare losses on both sides of Atlantic. Reporting by Bureax; compiled by Mrinalika, Roy, Pasquini, Alessandro, and Linda Pasquini. Editing by Alan Barona and Milla Nissi.
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Caspian Oil Pipeline Consortium prepares for court battle with Russia over stoppage orders
Three industry sources said that the Western-backed Caspian Pipeline Consortium was preparing to take on a Russian court to challenge a regulatory order which has crippled their export capabilities and threatens to cut off oil flow to global markets. After a series of inspections in response to an oil spill that occurred on the Black Sea, the Russian transport regulator ordered CPC, which includes Chevron, Exxon Mobil and others, to suspend its operations at two moorings. A court in Russia will review the decision of the regulator. Sources who spoke on condition of anonymity said that the CPC intends to contest the decision during the hearings. The CPC declined comment. Rostransnadzor did not respond to a comment request. CPC is a major oil export route in Kazakhstan. This is due to the fact that the country has exceeded its export quotas, primarily because of the production increase from the Chevron-led Tengiz Oilfield. Saudi Arabia and other OPEC+ countries have also pressed Kazakhstan to reduce production in order to meet its quotas. OPEC+ announced on Thursday that it would increase its output before the scheduled date, indicating the group's confidence in non-compliant member countries to reduce their output. Traders estimate that the CPC pipeline which transports about 1% of global oil supply could lose 50% of its capacity, if it is only allowed to use one berth. The CPC pipeline was set to export 1.7 million barrels of oil per day in April. This is approximately 6.5 millions metric tons. Therefore, more than 800,000. barrels could be lost per day. The traders also stated that the oil production of Kazakhstan, which exports 80% of the total oil through this route, will decline if these restrictions are in place for longer than a week. CPC announced this week that the restrictions would continue at the terminal until the irregularities discovered by the watchdog and which were not made public are addressed. In the past, Russia has imposed restrictions on the exports of the consortium due to bad weather and technical problems. A court in Novorossiisk, Russia, ordered CPC to stop the terminal operation for 30 days because of its documentation on oil spills. Benjamin Godwin is a partner of PRISM Strategic Intelligence in London, an investment advisory company. The pipeline is used by major energy companies in the U.S., Europe and elsewhere. The restrictions were implemented after U.S. president Donald Trump expressed his displeasure with Russia for the slow pace of peace talks in Ukraine and threatened to impose secondary duties on Russian oil buyers. Tengizchevroil is Chevron's Kazakhstan-based oil venture. In an email, it stated that the company was focused on ensuring safe and reliable operations. It referred any further questions to CPC. On Wednesday, Russia, the second largest oil exporter in the world, imposed further restrictions on a major oil export route. It suspended a mooring from the Black Sea port Novorossiisk, just a day after CPC's restrictions took effect. Mark Potter, David Evans and Mark Potter are responsible for reporting.
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Caspian Oil Pipeline Consortium prepares for court battle with Russia over stoppage orders
Three industry sources said that the Western-backed Caspian Pipeline Consortium was preparing to take on a Russian court to challenge a regulatory order which has crippled their export capabilities and threatens to cut off oil flow to global markets. After a series of inspections in response to an oil spill that occurred on the Black Sea, the Russian transport regulator ordered CPC, which includes Chevron, Exxon Mobil and others, to suspend its operations at two moorings. A court in Russia will review the decision of the regulator. Sources who spoke on condition of anonymity said that the CPC intends to contest the decision during the hearings. The CPC declined comment. Rostransnadzor did not respond to a comment request. CPC is a major oil export route in Kazakhstan. This is due to the fact that the country has exceeded its export quotas, mainly because of the production increase from the Chevron-led Tengiz Oilfield. Saudi Arabia and other OPEC+ countries have also pressed Kazakhstan to reduce production in order to meet its quotas. On Thursday, OPEC+ You can also find out more about the decision-making process by clicking here. To increase output ahead of schedule by signaling the group's confidence that non-compliant members will reduce output in the next few weeks. Traders estimate that the CPC pipeline which transports about 1% of global oil supply could lose 50% of its capacity, if it is only allowed to use one berth. The CPC pipeline was set to export 1.7 million barrels of oil per day in April. This is approximately 6.5 millions metric tons. Therefore, more than 800,000. barrels could be lost per day. The traders also stated that the oil production of Kazakhstan, which exports 80% of the total oil through this route, will decline if these restrictions are in place for longer than a week. CPC announced this week that the restrictions would continue at the terminal until the irregularities discovered by the watchdog and which were not made public are addressed. A court in Novorossiisk, Russia, ordered CPC to stop the terminal operation for 30 days because of its documentation on oil spills. Tengizchevroil is Chevron's Kazakhstan-based oil venture. In an email, it stated that the company was focused on safe, reliable operations. It referred any further questions to CPC. On Wednesday, Russia, the second largest oil exporter in the world, also imposed restrictions on a major oil export route. It suspended a mooring from the Black Sea Port of Novorossiisk just one day after CPC restrictions went into effect. The restrictions were implemented as U.S. president Donald Trump expressed his displeasure with Russia for the slow pace of peace talks in Ukraine and threatened to impose secondary duties on Russian oil buyers. Mark Potter (Editing and Reporting)
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Executives, trade and labor associations comment on Trump's reciprocal duties
U.S. president Donald Trump announced on Wednesday that he will impose a baseline 10% tariff on all imports into the United States, and higher duties for some of the biggest trading partners. This could escalate a global trade war and upset the global economy. The latest responses from business executives, unions and trade associations. Companies GERMANY'S FRESENIUS "We... strongly support the proposal to exclude pharmaceuticals from the reciprocal tariff, as such a tariff could potentially lead to shortages of important medicines for American patients." STEEL GROUP APERAM We will examine the feasibility of moving some of our production to other countries if we are able to export limited quantities from the EU into the U.S. The current lack of predictability in regulatory matters creates a hostile business environment both on the US and European sides. STELLANTIS The automaker announced that it would temporarily stop production in some of its Canadian assembly plants and Mexican assembly factories, including its Windsor assembly facility in Canada. ANTONIO BARAVALLE is the CEO of LAVAZZA We had planned to increase the local production (in the U.S.A.) by 100%. "We're ready to go... but there's this other element to investigate, the duties for Brasil... If they impose a 10% duty, then the 20% duty is already half. The coffee maker produces about 50% of the amount it sells locally in the U.S. FERRARI The purchase contracts for Ferraris contain standard and clear clauses that allow the company to adjust the price in the event of a change in the market conditions before the vehicle is delivered. A Ferrari spokesperson confirmed that new tariffs would also be applied to Ferraris ordered in the past but not delivered to the U.S. MOTOFUMI SHITARA, CEO, YAMAHA MOTOR "Our exports will certainly be affected." We will have to raise prices or reduce costs if these tariffs are extended over time, even for vehicles. MAERSK "We expect our customers to be more careful about their stock levels." We're likely going to see rush orders for air freight in the U.S. very soon, before the tariffs go into effect. We will also see an increase in the demand for bonded warehouses as customers want to delay clearing their goods until they have more certainty." GERRESHEIMER Tariffs are primarily affecting our exports to the U.S. from our Mexico-based plant. Injection vials are one example. We will pass on these customs fees to our customers as an additional cost. We will be able, if necessary and if customs duties remain in place for a longer period of time, to move our capacities. MASSIMO BATTAINI is the CEO of PRYSMIAN The announcement seems to have had a positive effect on the local production. The tariffs are applied to the finished products and removes any risk of U.S. producers being undercut by foreign production. ANDERS VINDEGG HEAD OF MEDIA RELATIONS, HYDRO "We work actively from Norway as well as in Brussels, the EU to inform and to actively work with the organizations and other measures we're part of in order to leverage the importance Norwegian aluminium for Europe." ASSOCIATIONS EUROCOMMERCE, EUROPEAN RETAIL INDUSTRY BODGE "EuroCommerce urges the EU and U.S. Administrations to engage constructively in dialogue. In the event that negotiations fail, EU can use its legal authority to take action against unfair trade practices by third-country countries. The EU has a wide range of tools to help it address the situation. International Apparel Federation The announcement by the U.S. Government of high taxes on trade with the rest is a shock to the global apparel industry. This unnecessarily creates an entirely new, often irrational world that affects billions of dollars in investments and the lives and livelihoods of tens and millions of people who work in our industry worldwide. Someone will pay the price in the end." CANADIAN STEEL ASSOCATION To reduce its dependence, the Canadian Steel Industry urgently needs the adoption of border measures to address unfair trade in steel in Canada, and help recapture the Canadian Market for our industry, workers, and communities. The Spanish Association of Olive Oil Exporters This 20% is a serious disadvantage for the Spanish olive oil industry, as compared to other countries that produce olive oil but do not belong to the European Union. "98% (of the olive oil consumed by Americans) is imported, so these tariffs would result in an increased purchase price which will be paid by U.S. consumers." consumers." KEVIN C RAVEN, CEO of ADS GROUP on AEROSPACE COMPONENTS We are not sure if the exemption from all tariffs (on items classified as airworthy by regulators) is still in place and if these tariffs are applicable or not. This could make the situation worse. COPA-COGECA EU FARMING GROUPS The introduction of additional tariffs could disrupt global supply chains and drive up prices. It would also limit the market access of farmers and agricooperatives from both sides of Atlantic. This will have significant economic implications for the agricultural industry. ANTHONY BRUN, HEAD OF FRENCH GROWERS ASSOCIATION (UGVC) "One might have been frightened by much higher tariffs. However, this risk remains and is associated with a possible conflict over bourbon whisky. Already, we face tariffs from China. Now, there is the U.S. and the consequences are going to be brutal for wine growers. ETHAN LANE SENIOR V.P. OF GOVERNMENT AFFILIATIONS, NATIONAL CATFARMERS BEEF ASSOCIATION "President Trump has taken action to remove numerous trade barriers which prevent overseas consumers from enjoying high quality, wholesome American Beef. NCBA will engage with the White House in order to optimize export opportunities and ensure fair treatment of America's beef producers worldwide. SIGRID de VRIES, DIRECTOR GENERAL, EUROPEAN MOBILE MANUFACTURERS ASSOCIATION "We urge both leaders to meet immediately to find a resolution to any issues that prevent free and fair trading between historical allies, and to allow the EU-US relations to flourish again." SWISS BUSINESS GROUP ECONOMISSE "Another escalation in the trade conflict is to be avoided. Swiss economic diplomacy and the Federal Council are urged to find quick solutions with the U.S. Government at the negotiation table. "From an economic perspective, the U.S. tariffs on Switzerland are not comprehensible - rather the opposite." DIRK JANDURA HEAD OF GERMANY EXPORTERS ASSOCIATION (BGA) "We'll have to pass on these tariffs as price increases and this will impact turnover in many instances." It is an economic dead end that will result in welfare losses on both sides of Atlantic. (Reporting and compilation by Bureax; edited by Alan Barona and Milla Nissi, and Alessandro Parodi.
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Reliance executive: India's diesel and gasoline demand will peak in 2035.
Reliance Industries executive said that India's gasoil consumption (diesel), which is expected to reach its peak in 2035, will continue to increase as drivers switch to cleaner fuels. India, a major driver of global oil demand, has set the goal of eliminating net carbon emissions by 2070. India will surpass China in terms of global oil consumption this year. Fuel consumption is expected to rise throughout the next decade. Energy transition is definitely on the agenda. "In our country, there isn't going to just be one fuel dominant," Harish Mehta said. Mehta, speaking at an event organized by the Petroleum Planning and Analysis Cell, said that India's transportation sector will be dominated by gaseous fuels, such as compressed natural gas and compressed Biogas, along with gasoline and gasoil. India would simultaneously have "a bouquet of energy sources, fuels for transportation and other things". Reliance operates the largest refinery complex in the world at Jamnagar, located in western Gujarat. The complex has two refineries that process about 1.4 millions barrels of crude oil per day. He expects the Indian government to continue intervening in the local fuel price to make fuels affordable for consumers and to mitigate the impact on global oil markets. A. K. Singh is the chairman of Oil and Natural Gas Corp. He said that India's oil and natural gas consumption will grow by 3-4% per year, and this requires a boost in domestic hydrocarbon production. A S Sahney said that as India's demand for energy continues to grow, state refiners will expand their capacity by around 20% over the next two-years.
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Analyst: US tariffs on corn from Ukraine could be beneficial to the country's corn
Analysts said that Ukrainian corn, which is a major component of the grain sector in Ukraine, could benefit from tariffs imposed on the U.S. U.S. president Donald Trump announced that a minimum 10% tariff would be applied to most imports. However, duties will be significantly higher on products from China and other countries. This is likely going to lead countermeasures which could drive up prices or reduce demand for U.S.-made goods. Ukraine is one of the world's largest corn producers and exporters. In a recent statement, ASAP Agri consultancy stated that "if key importers end up imposing duties on U.S. Corn, this will open a large window of opportunity for other suppliers." The Ukrainian corn market is strong: it has a competitive price, stable logistics and close links with European Union and Asian markets. The consulting firm said that Brazil was the first to be in line but it's harvest could not cover all of the demand. This is where Ukraine comes in and can claim its share. Barva Invest is another consultancy that said Ukraine views the U.S. not as a trading partner but rather an export competitor on the market for grains and oilseeds. It also stated that any counter-restrictions imposed by other countries against U.S. imports would have the biggest impact. The EU, Australia and China will most likely impose these measures. This opens strategic opportunities for Ukraine in areas where it competes with the U.S. Barva Invest told Telegram Messenger that "first of all, it is the market for corn and soybeans, and more indirectly, for rapeseed oil, sunflower oil, and barley." Ukraine produced 32 metric tons in 2023, and 26 metric tons in 2024. According to the UCAB, the country is expected to export 22 million tons of corn in 2024/25. Corn export prices are high, so farmers are likely to increase corn plantings this year. Ukraine harvested a record-breaking 6.2 million tonnes of soybeans in 2024, and about half of that volume could be export this season. Ukraine's soybean crop in 2025 Could be The final volume of the crop will be determined by the amount of rain that falls in May and/or June. Reporting by Pavel Polityuk, Editing by Chizu Omiyama and Ed Osmond
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Analyst: US tariffs on corn from Ukraine could be beneficial to the country's corn
Analysts at ASAP Agri said that Ukrainian corn could be a beneficiary of tariffs levied by the U.S. Ukraine is one of the world's largest corn exporters and growers. U.S. president Donald Trump announced that he would impose a minimum 10% tariff on all U.S. imported goods, and significantly higher duties for goods from China. This is likely to lead to countermeasures which could drive up prices or reduce demand for U.S. products. ASAP Agri stated in a press release that "if key importers end up imposing duties on U.S. Corn, this will open a large window of opportunity for other suppliers." The Ukrainian corn market is strong: it has a competitive price, stable logistics and close links with European Union and Asian markets. According to the consultancy, Brazil was "first in line" but that its harvest could not cover all demand. That is where Ukraine can "step in and claim their share". Ukraine will produce 32 million metric tonnes of corn in 2023, and 26 million in 2024. According to the UCAB, the country is expected to export 22 million tons of corn in 2024/25. Corn export prices are high, so farmers are likely to increase the area planted for corn this season. Reporting by Pavel Polityuk, Editing by Chizu nomiyama
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The increase in oil loadings at Russia's western port is 6% per month compared to April 1-8
The data and calculations provided by sources in the trade industry showed that oil loadings at Russia's western port over the period April 1-8 will increase by 90,000 barrels a day (bpd), compared to the same period last March, to reach around 1.7 million bpd. Calculations showed that the exports and transits of Urals, KEBCO, and Siberian Light grades of oil from Primorsk to Ust-Luga, Novorossiisk and Novorossiisk will increase by 6% per day from March 1-8. Calculations based on three sources show that Russia's daily oil output from its western ports is set to increase by 100,000 barrels a day in April compared to March, as domestic refinery maintenance begins to outweigh the output cuts under an OPEC+ deal. Several market sources believe that Russia's export of oil in April may fall below the March level, due to some refineries being repaired after drone attacks during February and March. This means more crude oil will be allocated for domestic oil plants before the peak season demand for motor fuels. Calculations based on data provided by LSEG and other sources indicate that Russia's total offline primary crude oil refining capability in April could fall to 2.137 millions metric tons, down from 3.58million tons in March. Reporting by Louise Heavens; Editing by Louise Heavens
The data center boom in Big Tech poses a new threat to US grid operators
Data Center Alley is a 30-square mile stretch of land outside Washington D.C. that houses more than 200 data centres. It consumes about the same amount of electricity as Boston. Power company officials were shocked when 60 data centers suddenly went off the grid last summer.
A standard safety feature in the data center industry was responsible for the mass reaction. Its purpose is to protect electronic and computer equipment from voltage fluctuations that could damage them. According to federal regulators, and utility executives, it led to a massive surge in electricity.
Grid operator PJM, and the local utility Dominion Energy were forced to reduce output of power plants in order to protect grid infrastructure. This was done to avoid a worst case scenario of a cascading of power outages throughout the region.
The near-miss, which is reported in detail here for the first time, forced federal regulators into recognizing a new vulnerability to America's electric grid: unannounced data center disconnections.
In an interview, John Moura, Director for Reliability Assessment and System Analysis at NERC said that as data centers grow and consume more power, the grid cannot withstand a loss of 1,500 megawatts of data centers. "At a certain level, it becomes too big to handle unless additional grid resources are added." Grid operators have historically planned for the possibility of large power plants going offline. Grid operators are forced to prepare for new contingencies due to the rapid growth of data centers that process the huge amounts of information needed for AI and crypto mining.
The behavior of data centres has the potential to cascade power outages across an entire region, said Alison Silverstein. She was a former senior advisor to the Chairman of the U.S. Federal Energy Regulatory Commission.
Data Center Alley, a cluster of Microsoft, Google, and Amazon facilities, is where the event took place on July 10, 2010. Around 70% of all internet traffic in the world flows through this area. The North American Electric Reliability Corporation, the federal regulator of grid reliability, formed a taskforce a month after the incident to investigate en masse disconnection by data centers and cryptocurrency miners.
This story examined thousands of pages in regulatory documents, and spoke to about a dozen executives from the industry, to find out the cause of the problem - a failed surge protection on Dominion’s Ox-Possum line, near Fairfax, Virginia, and how it spread throughout the region. NERC published a report on the incident in January, but didn't disclose the exact location, number of data centres involved or how PJM, Dominion and NERC worked to rebalance grid supply and demand.
Near-miss events are increasing.
As more data centers are brought online, the number of near misses like that in Data Center Alley is on the rise.
According to a December report by the Lawrence Berkeley National Laboratory, the amount of energy used by data centres has tripled in the last decade. It could triple again by the year 2028.
The Electric Reliability Council of Texas, the main grid operator in the state, reviewed disclosure filings and identified over 30 near-misses since 2020. These incidents were triggered by large energy consumers like data centers or crypto miners going offline.
A failed transformer in a west Texas substation caused 400 crypto-miners, data centres, and oil and gas production equipment to be unplugged without warning.
According to ERCOT, the mass exodus resulted in an excess of 1,700 megawatts - about 5% of total grid demand - forcing 112 megawatts to be shut down.
In a report published in December, NERC predicted that the risk of power failures will increase as more data centers are brought online. The report stated that the risk of energy shortages will increase in the United States over the next five to ten years.
The regulator encouraged utilities to update federal reliability standards for crypto mining and data centers.
A CONTROVERSIAL FILE
According to NERC, many data centers are designed by their operators so that they can switch to local generators as soon as there is a hint of a grid problem to minimize the risk of a service interruption like Google search or cryptocurrency mining.
Several grid operators propose that data centers "ride out" voltage dips routinely without disconnecting. Data center operators, however, are against the idea because it could damage electronic equipment and cooling system.
ERCOT retracted a proposal last year that would have imposed restrictions on ride-through data centers and crypto miner after being pushed back by an industry group. The Data Center Coalition.
Amazon, Google and Meta are among the group's members. They cited cost and risk to computer chips and cooling system exposed to fluctuations in voltage levels.
The coalition stated in comments submitted to ERCOT on January 20, 2024 that "data center hardware and power supply, like other electronics, are highly sensitive to the stability of power supply."
If you depart from this range, it will reduce the performance of your vehicle, decrease its longevity or cause irreparable damage to the components.
The coalition declined comment on this article. Amazon, Google, and Meta didn't return any messages seeking comments. ERCOT didn't return messages seeking comment. ERCOT's operations engineer Patrick Gravois told NERC’s Large Load Task Force in December that there is a "high potential" of the disconnection events becoming more severe as larger operations connect to the Texas grid.
Gravois stated that the grid operator was still trying to figure out exactly why big electricity users unplug themselves from the grid so as to avoid any surprises.
Ari Peskoe is the director of Harvard Law School's Electricity Law Initiative. He said that regulators might require data centers ride out voltage dips, but this could lead to Big Tech moving to states with more lenient rules.
Jim Simonelli is the chief technology officer of Schneider Electric's Secure Power division. He said that utilities and data centers can learn a lot from what occurred outside Washington DC in July.
Simonelli stated that the industry has not yet figured out how to make data centers grid-friendly.
(source: Reuters)