As data center operators face mounting energy demands and sustainability challenges, MIT researchers have identified a promising, potential solution: converting old coal power plants into thermal energy storage facilities to power data centers.

The scenario would breathe new life into closed or retiring coal-fired power plants and allow operators to use their existing infrastructure, grid connections, and land to store and provide renewable energy to data centers, said Yifu Ding, a post-doctoral research associate for the MIT Energy Initiative and lead author of a 2024 report on the subject.

In fact, one energy startup, Massachusetts-based Malta, Inc., is working to turn the concept into reality with its energy storage technology.

When energy from solar and wind farms is abundant, Malta’s solution stores the renewable energy as heat in molten salt thermal storage systems. Then, when electricity is needed, the stored thermal energy is converted back to electricity to supply energy to data centers, explained Kevin Stone, Malta’s vice president of engineering.  

The result is data centers that can use renewable energy around the clock, even when the wind isn’t blowing or at night when the sun isn’t shining.  

“This is a way for data centers to use more of their electricity as renewable electricity when it isn’t directly available,” Stone said in an interview with Data Center Knowledge.

Related:Solar-Powered Data Centers: Why the Forecast Is Only Partly Sunny

Research suggests expired coal facilities offer multiple repurposing opportunities beyond thermal energy storage, including sites for nuclear reactors and data center developments. Image: Alamy.

Rolling Coal: What to Do With Shuttered Coal Power Plants?

The coal industry has continued its decline over the past decade, and aging coal power plants continue to shut down due to environmental regulations and competition from more affordable alternatives like natural gas power plants and renewables like wind and solar.

According to Ding’s research paper (PDF), ‘Repurposing Coal Power Plants into Thermal Energy Storage for Supporting Zero-carbon Data Centers,’ expired coal facilities can be repurposed for not only thermal energy storage but also to house nuclear reactors and even data centers.

Another option is converting the old power plants from coal to natural gas, which is cheaper and produces fewer carbon emissions. In fact, the Homer City Generating Station, previously the biggest coal-burning power plant in Pennsylvania, will be transformed into a major natural gas-powered data center campus delivering up to 4.5 GW of power, its developers announced in April. 

In a bid to bolster the coal industry, President Donald Trump recently signed executive orders that allow older coal plants scheduled for closure to remain open to meet the growing power needs of AI and data centers.

Related:Beyond Megawatts: Rethinking How We Measure Data Center Capacity

However, energy market experts predict that any coal industry resurgence will likely be fleeting because natural gas is cheaper and the renewable energy market continues to expand, according to published reports.

Pennsylvania’s former largest coal plant, Homer City Generating Station, is being converted into a natural gas-powered data center campus with 4.5 GW capacity. Image: Homer City Redevelopment.

The Case for Retrofitting Coal Power Plants

MIT Energy Initiative’s Ding said repurposing coal power plants into thermal energy storage presents a unique opportunity for their owners to revitalize their businesses. It also provides a ready-made environment to house data centers.

“Some coal plants are about to retire due to age,” she told Data Center Knowledge. “There is great potential to accommodate data centers, and there is potential to convert them to thermal energy storage to reuse existing grid interconnection and cooling infrastructure.”

Instead of using a boiler to burn coal, coal power plant owners would replace their boilers with molten salt energy storage systems, she said. Molten salt is a medium that can store heat at high temperatures. When electricity is needed, they can reuse their steam turbines to turn the heat back into electricity, she said.

That’s exactly how Malta’s technology works. The startup, which spun off from Google’s X research division in 2018, has developed long-duration energy storage technology that can store heat for eight hours to multiple days, compared to battery technology that typically stores electricity for four to six hours.

Related:The Pros and Cons of Wind Power for Data Center Sustainability

Malta’s Molten Thermal Storage Solution 

In an interview with Data Center Knowledge, Malta CEO Phil Delleville said the company’s technology has many applications, including integration into coal and natural gas power plants, district heating and cooling systems, and standalone applications, such as geothermal plants.

Coal power plants can be retrofitted with Malta’s technology in different configurations, he said. For example, coal plant owners can build solar or wind farms on-site and connect to Malta technology. They can also establish a data center at the coal plant and use renewable energy directly without connecting to the grid.

Alternatively, they can get electricity directly from the grid. To get renewable energy, they can arrange power purchase agreements (PPAs) with solar and wind farms. And if a data center is off-site, they can use the grid connection to export the power to the data center through PPAs, Stone said.

“In a typical use case, we are in a place with a lot of solar power during the middle of the day. I use that to charge my system, and when the sun goes down, and I lose my solar power, I start up our system,” Stone said. “Now I’m releasing energy (from the thermal storage tanks) all during the night, and then the next morning, I’ve used up all my storage, and we start to charge again when the sun comes up.”

Malta’s technology, called the Steam Energy Management and Storage (SEMS) solution, consists of three main components: a heat pump that converts electricity into thermal energy, molten salt storage tanks that store the heat, and steam turbines that convert the stored heat back into electricity when electricity is needed, he said.

The system includes software: an advanced control system to run the plant, which includes a digital twin and a grid optimization software layer that analyzes prices for renewable energy, the forecast for sun and wind and makes recommendations on when to store energy in the tanks, Stone said.

The startup’s SEMS technology can integrate with a coal power plant’s existing equipment, such as steam turbines, piping and condensers. Since they no longer need to stockpile coal or use a coal boiler, that space can be used for molten salt storage tanks.

“They have plenty of space for us to replace those coal piles with molten salt storage,” Stone said.

Once commercially deployed, the technology can support between 100 MW to over 500 MW of power.

In fact, Malta plans to build a commercial-scale 14 MWe demonstration plant in Spain designed to deliver dispatchable clean energy to the national power grid. The company will begin construction by late 2025, and the plant is expected to become operational by late 2027.

Overall, in this specific use case, Malta’s technology would allow coal power plants to transition to cleaner energy production while taking advantage of its existing infrastructure, Stone said. It would also preserve jobs in their communities.

“They can continue to utilize their asset, continue to employ the employees from that region and continue to get positive economic benefits,” he said.

Amid soaring power demands, the data center industry is rapidly pivoting toward innovative energy solutions, exploring everything from retrofitted coal plants to thermal storage technologies. Image: Alamy / Data Center Knowledge.

Business Case for Retrofitting Coal Plants: Does It Make Economic Sense?

At MIT, Ding and her co-authors examined 12 coal power plants within the Electric Reliability Council of Texas (ERCOT)’s grid, simulating scenarios with retrofitted coal plants using renewable energy and co-located data centers.

They concluded that retrofitting coal plants with molten salt storage for zero-carbon data centers would cost significantly less than using lithium-ion batteries.

However, whether coal plant operators pursue a retrofit with thermal energy storage depends on U.S. policies. If data centers don’t want to go zero carbon or are not required to do so, coal plant operators may pursue a different plan for their facilities, Ding said.

One commercial real estate broker well-versed in energy projects said retrofitting coal plants for thermal energy storage has potential, but questions whether it’s their best use.

Bryce Custer, a partner with commercial real estate firm Ohio River Corridor, has overseen site selection for natural gas power plants and renewable energy projects. His clients in Ohio, Pennsylvania, and West Virginia include developers, property owners, and data center operators.

Discussing the issues raised by the MIT research paper, Custer told Data Center Knowledge: “Based upon my experience with coal power plants and other large places with large infrastructure, it will work. But is it cost-effective? Will someone want to purchase power from these thermal energy storage units?”

He added: “At the end of the day, by the time I generate my renewable energy, store it, and build all my facilities and put this stuff in, does it make economic sense? That’s going to be the real question.”

About a year ago, coal plant owners sold off their facilities to companies that specialize in environmental mitigation. These companies demolish and clean up the sites and then resell them, Custer said. But in the ensuing 12 months, coal plant owners have rethought their strategies because they realized they were giving away a key asset.

“They realize now that there’s significant value in the land and the infrastructure in place,” he said.

Custer believes the future is nuclear through the use of small modular reactors (SMRs). But while that technology is still in its nascent stages, repurposing former coal plants, steel mills, and other large facilities into natural gas power plants is ideal because the area – Ohio, Pennsylvania, and West Virginia – is home to one of the largest supplies of natural gas in the country.

Some retired coal power plants in the region have already been converted to natural gas power plants – and more conversions are currently under discussion.

“Right now, the most cost-effective solution to generate electricity is going to be natural gas,” the energy expert said.

Custer leaned into the idea of using retired facilities such as old coal power plants to produce, not store, power, particularly given the growing data center power problem. He said there may be situations where thermal storage could make sense, but it would be more of an outlier than a primary option.

“It’s a solution, no doubt,” Custer said, referring to thermal storage. “I would rather be using facilities to generate large amounts of power – be it renewables, SMRs or natural gas – than to use it to store energy.”

Next-Gen Energy Technology: An Operator’s Perspective

One data center operator said repurposing coal plants with thermal energy storage has merit.

Rahul Mewawalla, CEO of the Mawson Infrastructure Group, said the industry needs more innovative thinking when it comes to developing new sources of energy while repurposing existing infrastructure.

Mawson, based in Midland, Pennsylvania, provides digital infrastructure for AI, high-performance computing and digital assets and operates three data centers in the U.S.

At a macro level, Mewawalla said he is generally supportive of the MIT paper because building a new energy storage facility, from acquiring the land and installing infrastructure to getting permits, could easily take three to seven years.

Repurposing coal power plants with energy storage can accelerate the ability to provide power for data center operations, he said.

“We are supportive of repurposing existing infrastructure to meet the energy needs of tomorrow,” he told Data Center Knowledge. “If you think about the greenfield vs. brownfield approach, when you repurpose existing infrastructure, you’re able to not only save time, but you also save on capital expenditures.”

However, on the energy storage front, his company has a long-term belief in battery energy storage systems. For backup power, a battery energy storage system can respond to the grid in milliseconds, ensuring 24/7 redundancy, he said.

Would the company use retrofitted coal plants with thermal energy storage? It depends, Mewawalla said.   

“It will depend from market to market and facility to facility,” he said. “Not all coal plants are the same. Each of them is built differently in different markets. The general approach, which is an opportunity to repurpose these facilities with thermal energy storage systems and use the existing infrastructure, we are generally supportive of.”