For data center operators, the uninterruptible power supply (UPS) has long represented a critical safeguard against potentially damaging power anomalies, as well as vital battery backup to ensure business continuity during an unexpected power outage. Yet thanks to new technology, data center UPSs now have the capability to achieve a dual benefit — transforming from a load on the grid to a value-generating asset.

If that sounds too good to be true, consider this: most large-scale data centers have deployed substantial battery banks to provide adequate backup in the event of a blackout. Yet the reality is, these batteries sit unused the vast majority of the time because power outages occur infrequently. Operators in today’s hyperscale, multi-tenant and other large data centers now have the opportunity to leverage this underutilized asset, turning their UPS into a profit center and supporting the grid as a distributed energy resource (DER).

It is the adoption of lithium-ion batteries — which offer a longer lifespan and eight times the cycle rate of traditional VRLA batteries — that has created the potential for this evolution of the traditional UPS. While the data center maintains control of its energy — choosing how much capacity to offer and when — it has the ability to convert the traditional power backup into an energy storage device, providing a range of benefits to operators seeking to lower energy bills and optimize consumption.

This is especially valuable considering that power costs continue to skyrocket; in fact, energy ranks as the second highest operating cost in 70 percent of worldwide data centers, surpassed only by labor, according to Gartner. Even more, a 1 MW data center will devour 160M kW hours of energy over a 10-year period — equivalent to the amount consumed by 1,400 typical U.S. households in the same time span.

Yet with EnergyAware technology, existing lithium-powered UPSs can help organizations optimize those costs and generate additional revenue. Opportunities include providing peak shaving to help avoid or reduce demand charges; shifting energy consumption for time-of-use rate optimization; and providing frequency regulation to help grid operators meet explosive growth demands. Unlike a gas peaker plant, the battery banks are able to dispatch instantaneously to better meet short-term demand spikes.

Eaton’s technology was recently put to the test by Microsoft and Eaton who partnered to find a way to put Microsoft’s assets to work around the clock.  Eaton’s controller allowed the UPS to track frequency regulation signals and quickly respond by charging or discharging the battery to balance the grid. In a technology demonstration with PJM, a regional transmission organization (RTO) serving 13 states and the District of Columbia, the UPS exceeded the operator’s requirements for accuracy, response time and precision on a self-scored test, proving the technology’s ability to serve as a viable DER.

The implications of the EnergyAware UPS are significant, both for the grid and for data center operators. The technology can be utilized to lower demand and peak time charges, as well as contribute to clean energy goals. Customers can use an existing asset to create a new revenue stream and lower energy costs while still providing a vital backup solution.

In fact, EnergyAware technology could ultimately prove instrumental in reshaping the overall power generation industry. As Sean James, director of energy research at Microsoft, explained: “In the future, you don’t have a data center or a power plant. It’s something in the middle. A data plant, for example. Where this thing isn’t just a load on the grid, it’s an asset on the grid.”