How Kraken and Schneider Electric are Taking On Grid Strain

Data centre electricity demand reached around 415TWh in 2024.

To put that in perspective, that is roughly equivalent to the UK's entire annual power consumption.

That number is projected to double by 2030.

For the operators and utilities keeping those services running, the traditional answer has been costly infrastructure upgrades before sites can reach full capacity.

A new partnership between Kraken and Schneider Electric is betting there is a faster, cheaper way.

What the two companies bring

Kraken, spun off from UK energy provider Octopus Energy last year, has built its reputation on an AI-driven platform that coordinates distributed energy assets, particularly EVs, batteries and heat pumps – so they draw power from the grid at times that keep supply and demand in balance.

Schneider Electric, a global force in energy management, brings real-time network monitoring through its One Digital Grid Platform and EcoStruxure suite, tools designed to identify distribution problems and manage flexible loads across networks.

Together, the companies are developing a joint offering aimed at utilities and grid operators.

The goal is to give them greater visibility over low-voltage networks and the means to manage congestion without waiting for physical grid upgrades.

Schneider estimates the global value of demand-side flexibility across industrial and commercial sectors could be worth up to US$1tn per year.

The congestion problem

Grid congestion is a direct constraint on capacity and growth.

Where grid infrastructure cannot accommodate new or expanding facilities, operators face delays and significant capital expenditure before they can run at full load.

The software-driven approach that Kraken and Schneider are pursuing looks to extract more usable capacity from grids as they already exist, rather than requiring new cables or substations first.

Frédéric Godemel, EVP of Energy Management at Schneider Electric, elaborates on the pressure utilities face.

"Utilities and grid operators are under real pressure to maintain reliability, respond to shifting demand and make better decisions with better data, whilst working with aging infrastructure," he says.

"Our aim is to create an interoperable energy system that works seamlessly.

"By combining Schneider Electric's platform approach with specialist partners like Kraken, we can help customers make the most of existing assets, reduce complexity, roll out new capabilities faster, unlock hidden capacity and see value sooner."

AI as both problem and solution

There is an evident irony in using AI to solve a problem that AI has helped create.

Data centres are a primary culprit of surging electricity demand, yet the machine learning capabilities embedded in platforms like Kraken's are key to the solution being proposed here.

"For Kraken, it's clear: speed to flexibility means speed to power. AI is not just a driver of demand – it revolutionises the capacity we can get out of the grid we already have," says Amir Orad, CEO of Kraken.

"Together with Schneider Electric, we're building a more resilient, more affordable and cleaner energy system – for consumers and for the planet."

What comes next

As electrification of transport, heating and industrial processes continues to accelerate alongside data centre growth, the pressure on grid operators is only intensifying.

Whether demand-side flexibility software can keep pace with the rate at which load is growing is the critical question hanging over this collaboration.

Right now, Kraken and Schneider Electric are making the case that the grid operators do not have to wait for new infrastructure to unlock the capacity they need.