Economy
Rising AI data center electricity demand revives aging power plants
In Chicago’s working-class Pilsen neighborhood, an old oil-fired power plant dating back to the ’60s rises from an industrial area behind Dvorak Park, which, in warmer weather, is at times packed with children climbing on its colorful playground and zooming down slides.
The rarely used eight-unit Fisk power plant, owned by Houston-based NRG Energy, was scheduled to retire next year. But then came artificial intelligence.
Prices shot up in the country’s biggest power market – PJM Interconnection – as electricity requests from data centers exceeded existing supplies, sounding the alarm over power shortfalls, and making Fisk and other plants like it suddenly profitable.
“We believe there’s an economic case to keep them around, so we withdrew the retirement notice,” said Matt Pistner, senior vice president of generation at NRG, of Fisk’s eight power-generating units.
The Fisk power plant is among a growing number of so-called “peaker” electric generating units being pressed into service across the U.S. as the nation’s electrical system faces increasing demand from data centers powering Big Tech’s investments in artificial intelligence.
Peakers, which are designed to operate only in short bursts during periods of peak electricity demand, help stave off blackouts by supplying power on a moment’s notice. But there’s a trade-off: these often decades-old, fossil-fueled facilities emit more pollution when they are running and cost more to produce electricity than continuous power plants.
A Reuters analysis of filings with the country’s biggest power grid shows that about 60% of oil, gas and coal power plants slated for retirement in PJM postponed or cancelled those plans this year. Most of the plants averting shutdowns are peaker units.
The Fisk peakers were built on the site of a now-defunct coal-fired electricity-generating station that operated for over a century. After years of fierce opposition by local residents, the coal plant shut down more than a decade ago, but eight peaking units that run on petroleum oil continue to operate on the site.
“When we found out that the coal plant was closing, but there was still going to be power produced at the site, it was very disappointing,” said Jerry Mead-Lucero, a longtime advocate for the closure of the Fisk coal station who spent most of his adult life in Pilsen.
Following the coal plant closure, pollution plummeted, but it didn’t vanish. Sulfur dioxide emissions from the site ranged from approximately 2 to 25 tons per year, according to the Environmental Protection Agency (EPA), as the eight-unit peaker plant occasionally came online to feed the grid.
“That’s not an insignificant amount considering the low chimneys and homes nearby,” said Brian Urbaszewski, Director of Environmental Health Programs for the Respiratory Health Association, an Illinois nonprofit that focuses on helping people with respiratory disease.
Dirty power
Because they were built for speed rather than efficiency, peakers often lack pollution controls such as mercury scrubbers, which remove the toxic chemical from power plants’ emissions, and particulate-matter filters, according to academic and federal government research.
Some also have lower smokestacks, or chimneys, environmental advocates say, meaning pollution can be more concentrated locally.
Keeping peakers running longer may be accelerated under the U.S. President Donald Trump’s administration, which said it was exploring ways to tap into existing power sources, including peaker plants and other emergency systems, to meet the massive new electricity demand quickly.
“There are a ton of peaker plants that could operate more,” U.S. Energy Secretary Chris Wright told Reuters in an interview in September, adding that clean air regulations have kept more from running more frequently. “The biggest targets are spare capacity on the grid today.”
While peaker plants contribute about 3% of the country’s power, they have the total capacity to produce 19%, according to a report by the U.S. Government Accountability Office.
Tapping into that spare capacity, however, could result in increased emissions of harmful pollutants into neighborhoods that are already overburdened with environmental hazards.
The country’s roughly 1,000 peaker plants are disproportionately located in low-income communities of color, according to academic and federal government research, meaning that extending the plants’ lives could leave vulnerable Americans to bear the brunt of more pollution.
A 2022 study of formerly “redlined” U.S. communities, which were cut off from financial services like mortgages for being predominantly Black or immigrant, found that residents were 53% more likely to have had a peaker plant built nearby since the year 2000 than in non-redlined areas.
“If you were a redlined neighborhood, you were more likely to have a fossil fuel power plant built nearby, and we saw that relationship was even stronger for peaker plants,” said UCLA professor of environmental health sciences Lara Cushing, who led the study.
Power demand is straining the grid
Most of the country’s peaker plants were built during two periods of growth in energy consumption: in the mid-20th century, as electricity. Common household items, and at the turn of the century, appliances became widespread as the economy grew and computers gained popularity. Afterward, as energy-sapping devices and infrastructure became more efficient, U.S. power demand waned and many fossil-fired power plants shut.
Meanwhile, solar and wind farms, which only produce power when the sun is shining and the wind is blowing, began to supply a greater share of the country’s energy.
“We’re kind of making the old system work harder and that’s part of why we’re seeing this increased use of plants operating as peakers,” said Frank Rusco, a director with the Government Accountability Office, which was directed by U.S. Congress, at the urging of environmental justice groups, to study the use of peaker plants and how they intersect with American communities.
The study found that natural gas peaker plants emit 1.6 times as much sulfur dioxide per unit of electricity produced, on a median basis, as non-peaker plants.
Fisk is part of the nation’s largest electrical grid, PJM Interconnection, which extends across 13 states and encompasses the world’s largest concentration of data centers. Demand from AI data centers is threatening to engulf the grid’s power reserves, and it is already driving up prices.
Prices paid to power suppliers in PJM to ensure plants run at times of spiking demand soared by more than 800% this summer, compared to a year earlier. That made owning peaker power plants much more lucrative.
“It is clear today, nationally, that electricity demand is outstripping supply, the market reflects this, and generators are responding,” PJM spokesperson Jeff Shields said. “We cannot afford to lose the existing generation while we continue to bring on new generation to keep pace with the electricity needs of data centers and other large loads powering the country’s economy.”
About 23 oil, gas and coal power plants in PJM territory were scheduled to retire starting in 2025 or shortly after, according to a Reuters analysis of letters sent to PJM Interconnection by power companies.
Since January, U.S. power companies, the grid operator, and the federal government have delayed or cancelled the retirements of 13 of those power plants, according to the letters. Of those plants that averted closure, 11 were peakers.
Among those delayed were the roughly 55-year-old units at the “Eddystone” Philadelphia, owned by Constellation Energy, which were ordered by the Department of Energy to continue operating the plant outside P. The Wagner peaker near Baltimore, meanwhile, was kept online at PJM’s request while the grid operator coordinated the transmission required for the generator’s removal.
Many of the retained plants were built as peakers, while others were initially intended to operate continuously but were later downgraded to run only during emergencies.
‘Last line of defense’
Fisk owner NRG Energy says peakers are essential safeguards for the grid that are being called on more often, not just for data centers but for the electrification of manufacturing and transportation, and to avert blackouts caused by increasingly severe winter storms and summer heatwaves.
Having the Fisk peakers in the city means that Chicago doesn’t need to import electricity in an emergency when external power sources go down.
“They really are the last line of defense, and the shock absorber, for the system,” said Matt Pistner of NRG Energy. “When they’re needed, there is no other place to go.”
While NRG owns power-generating sources ranging from nuclear to wind and solar, oil-fired peakers add another layer of certainty by ensuring that the power fuel source can be stored on site, Pistner said.
“During its run times, the power plant consistently operates within federal and state environmental regulations – and we are proud of its record,” an NRG spokesperson told Reuters separately.
Energy experts say there are alternatives to peakers. Investing in more robust transmission lines could transport electricity from regions with surplus power to those with power shortfalls.
“If we do that, the system would run more efficiently and you would probably have a reduction in the amount of reliance on peakers,” said the GAO’s Rusco.
Batteries, which are undergoing technological improvements to store power for longer, could also replace many peaker units, according to clean energy advocates.
In the meantime, as demand for AI power rises, communities such as Pilsen, which have successfully fought to close some pollution sources in recent years, may find peaker plants more difficult to oppose.
“It all adds up to significant cost increases for electricity consumers and significant increases in local pollution and will prevent new clean energy generation from connecting to the grid,” said John Quigley, of the University of Pennsylvania’s Kleinman Center for Energy Policy
PJM said it would continue to connect carbon-free renewable power, nuclear and gas-fired energy to the grid regardless of whether peakers stay on longer.
“We need every single megawatt of energy we can get right now,” Shields said. Deactivating existing power plants, he added, “ignores reality.”
Northern Illinois is a budding data center market, with at least one data center already operating in Pilsen and multiple other energy-intensive projects planned for nearby areas, including a 20-building campus announced this year by T5 Data Centers.
Mead-Lucero worries that the Fisk peaker units will continue the legacy of environmental hazards plaguing his hometown, which also sees emissions from industrial truck traffic, a metal scrapper and a major highway cutting through the neighborhood. “You add all of these compounding factors, and you end up with a real problem again.”
Turkish contractors have undertaken 12,900 projects worth $570 billion across 139 countries, Trade Minister Ömer Bolat said Friday, inviting European companies to expand their partnerships with Turkish firms.
Speaking at the European International Contractors (EIC) General Assembly in Istanbul, Bolat said the portfolio included completed and ongoing projects, with $520 billion of the total achieved over the past 23 years.
The sector began its overseas operations in Libya in 1972. Bolat said the Turkish companies have since completed more than 3,100 international technical consultancy projects worth $3.5 billion.
Forty-nine Turkish companies featured in Engineering News-Record’s 2025 ranking of the world’s top 250 international contractors, placing Türkiye second behind China, which had 71 firms.
Europe accounted for 40% of overseas contracts secured by Turkish contractors in 2025, Bolat said, citing projects in Spain, Portugal, the Netherlands, Poland and Romania.
He said the growing need to renew social housing, infrastructure, transport networks and buildings across Europe offered significant opportunities for cooperation.
“As Turkish contracting companies, we are ready to work with you and enter into partnerships,” Bolat said.
He also invited European businesses to invest in Türkiye, saying the country hosted 89,000 foreign-invested companies, 63% of them European.
“If you are not in Türkiye, you are not too late. We invite you to Türkiye,” he said.
Bolat said Türkiye has invested more than $300 billion in infrastructure over the past 23 years, expanding its ports, airports, roads, railways and logistics networks.
Amid regional wars, protectionism and supply chain disruptions, resilience has become as important as efficiency, he said.
Türkiye aims to become a center for production, trade, logistics, investment and connectivity, Bolat added.
Turkish prosecutors have identified 214 individuals and companies they say made a combined TL 187.65 billion ($3.8 billion) from three of the investment funds at the center of the country’s fund turmoil, according to a report Friday.
Authorities are now seeking to recover what they describe as unjust gains and return money to affected investors, the Sabah newspaper said.
Justice Minister Akın Gürlek told Sabah that the Istanbul Chief Public Prosecutor’s Office had passed the names to the Savings Deposit Insurance Fund (TMSF).
The TMSF has started notifying those on the list formally that the money must be returned. The recovered funds will be collected in accounts set up for investors who suffered losses.
Who made gains
According to the investigation file, the list includes 141 individuals and 73 companies. The individuals are reported to have each made more than TL 100 million, for a total of about 100.68 billion. The companies made almost TL 86.98 billion in total.
The gains came from funds managed by Tera, Pusula and Hedef Portföy, three of the seven management companies whose funds are being liquidated.
Tera funds generated approximately TL 28 billion in gains for 102 individuals and TL 62.1 billion for 38 companies, the report said.
Pusula funds yielded around TL 69.7 billion for 19 individuals and approximately TL 10 billion for 20 companies. Hedef Portföy funds generated nearly TL 3 billion for 20 individuals and TL 14.9 billion for 15 companies.
Focus on mid-September withdrawals
Authorities launched a sweeping investigation and market intervention last month after suspected price manipulation in a number of thinly traded stocks triggered heavy losses and redemption pressures at investment funds.
The Capital Markets Board (SPK) halted trading in more than 130 funds on Sept. 17. Nearly half a million investors have been affected.
Gürlek said investigators were looking especially closely at people who sold fund holdings and withdrew their money on Sept. 13, 14, 15 and 16.
Prosecutors’ examination found that these people withdrew in advance, acting on information given to them. Gürlek said the investigation was being widened in light of these findings.
Payments underway
Separately, Treasury and Finance Minister Mehmet Şimşek said on Thursday that 17 funds open to trading on the TEFAS electronic fund platform had been liquidated and that the money owed to about 43,000 fund investors had been deposited in the relevant banks.
Şimşek said comprehensive regulations were being introduced to prevent a repeat, and that further measures would be taken beyond the existing rules.
Meanwhile, the ruling Justice and Development Party (AK Party) was due Friday to submit draft legislation governing the liquidation of the funds.
The proposed temporary law aims to establish a legal framework for the liquidations, prioritize the protection of small investors and set rules for payments.
Under the proposal, authorities would adjust amounts invested in and withdrawn from the funds for inflation, with interim payments of up to TL 1 million per investor targeted for October.
The bill would also include provisions for recovering losses from those held responsible and establish a legal basis for extraordinary liquidation proceedings.
Real estate is among the assets that could be sold to raise funds for investor payments, with the legislation setting out how such assets would be liquidated and the proceeds distributed.
Türkiye and the European Space Agency (ESA) are reportedly holding talks to renew cooperation and develop joint orbital programs, an expert said Friday.
Gülin Dede, partnerships director at the nonprofit Space Renaissance International (SRI), said she had heard that discussions were underway and expressed optimism that they would lead to positive results and revive previous cooperation agreements between Ankara and the agency.
Dede, Türkiye’s first female analog astronaut who previously worked at ESA’s technology development center in the Netherlands, said European space officials were showing growing interest in expanding cooperation with Türkiye.
She also welcomed Türkiye’s signing of the Artemis Accords, an international framework for cooperation in civil space exploration.
Dede was speaking on the sidelines of the International Astronautical Congress (IAC) in the southern Antalya province, which she said helped raise Türkiye’s profile within the global space community.
“That this event is being held in Türkiye sends a wonderful message to the global space community and ecosystem, evident from the academic contribution of the delegates and their satisfaction with the expo, the evaluation of Turkish firms’ exhibits and presentations from other countries,” she said.
“I’m here myself as a committee member, and our work is progressing successfully,” she added.
Dede said ESA had “always sought cooperation with Türkiye” and stressed the importance of maintaining the momentum generated by the congress through sustained investment in the country’s space capabilities.
She also said greater participation by Turkish astronauts in international missions and activities could help strengthen Türkiye’s position as a partner in future space projects.
Dede urged Ankara to take a more active role in the European Organization for the Exploitation of Meteorological Satellites (EUMETSAT) and deepen its engagement with the U.N. Committee on the Peaceful Uses of Outer Space (COPUOS).
Türkiye opened the Çerkezköy-Kapıkule section of its Halkalı-Kapıkule railway on Friday, extending the national high-speed network to the Bulgarian border.
The new section is 153 kilometres (95.07 miles) long. It starts at Çerkezköy, a town in Tekirdağ province in southeastern Thrace, west of Istanbul inside Europe. It ends at Kapıkule, Türkiye’s main rail and road border crossing with Bulgaria, near the city of Edirne in the country’s far northwest.
“With the launch of our project, a new era will begin, and we will see its effects across a wide range of areas,” President Recep Tayyip Erdoğan told the opening ceremony in Kırklareli province in northeastern Thrace. EU Enlargement Commissioner Marta Kos was also present.
Erdoğan said it would eventually serve as a boost to production, exports, employment, trade and tourism. “Our project will make a significant contribution to the Turkish economy,” he noted.
The new section is the longest part of the 229-kilometer Halkalı-Kapıkule project, which begins at Halkalı on Istanbul’s western edge. With the opening, Tekirdağ, Kırklareli and Edirne join the high-speed network.
Tekirdağ lies on the Sea of Marmara coast, Kırklareli in the northeast of Thrace along the Bulgarian border, and Edirne in the northwest corner where Türkiye meets both Bulgaria and Greece.
The line will connect not only continents but also Türkiye and the European Union, Transport and Infrastructure Minister Abdulkadir Uraloğlu said.
“We will continue to work together to further advance our cooperation with the European Union on this project,” Uraloğlu added.
Greater capacity, faster journeys
The new line raises the number of Turkish provinces reached by high-speed rail to 14.
Erdoğan said the line will cut travel times sharply.
Passenger journeys between Halkalı and Kapıkule will fall from four hours to 1.5 hours, while freight transit will drop from 8.5 hours to 3.5.
Annual passenger capacity is expected to rise from 600,000 to about 3 million, and annual freight capacity from 1.5 million to 9.5 million tons, according to officials.
“This means that transportation will become faster, logistics will improve, and travel times will be reduced,” said Erdoğan.
The project also covers new station buildings at Babaeski, Lüleburgaz and Büyükkarıştıran, and the reconstruction of the Kapıkule and Edirne stations. Babaeski and Lüleburgaz are towns in Kırklareli province, and Büyükkarıştıran is a settlement in Lüleburgaz district, also in Kırklareli.
European link
Transport and Infrastructure Minister Abdulkadir Uraloğlu described the line as one of the most critical structures linking the Middle Corridor to Europe.
The Middle Corridor is the trade route connecting Asia and Europe through Central Asia, the Caucasus and Türkiye. Kapıkule, on the Bulgarian frontier, is where this line meets the European rail network. The project is designed for 200 kph passenger services and is part of the Trans-European Transport Networks.
The EU contributed to the financing. The 153-kilometer section was co-financed by the EU and Türkiye, while the remaining 76 kilometers of the Halkalı-Kapıkule route was built by the Transport and Infrastructure Ministry.
Uraloğlu acknowledged the EU’s role, saying the project was partly financed with EU pre-accession (IPA) funds.
Uraloğlu also placed the project within Türkiye’s wider rail expansion, saying the country has grown its rail network from 10,948 to 14,272 kilometers and built 2,604 kilometers of high-speed track from scratch.
Erdoğan said transportation investments have been at the top of the list of areas where he says they have propelled Türkiye forward over the past 24 years.
“During our time in office, the present-day value of our transportation investments has risen to $354 billion. Railways account for $80 billion of this total,” he noted.
Ukraine struck and partly disabled a data center operated by Russian technology company Yandex on Friday, a day after it hit a similar but more significant facility, widening the scope of its attacks against Russia after Moscow targeted data hubs inside Ukraine.
Yandex, which is heavily involved in Russia’s AI development and is sometimes called “Russia’s Google,” said its data center in the Kaluga region southwest of Moscow had been struck by Ukrainian drones and partly put out of action.
A day earlier, a Ukrainian attack shut down Yandex’s major data hub in Sasovo in the Ryazan region, where two of the three supercomputers used to develop the company’s AI model are housed. Yandex has said it is assessing the damage from that strike and cannot confirm whether the equipment can be restored.
Locked in an escalating and deadly war of attrition after more than four years of fighting, both Russia and Ukraine have expanded drone attacks this year on infrastructure targets, from energy facilities and refineries to ports and vessels carrying oil and grain, e-commerce warehouses and, most recently, data centers.
Yandex, whose apps have become an indispensable part of many Russians’ lives, said the attacks had struck at the core of its operations and that it was trying to keep its services going.
“Data centers are the iron heart of Yandex. Their operation is critical for services that have become part of people’s everyday lives. Millions of users check traffic and plan routes, listen to music, watch movies, order groceries and get answers to their questions,” it said in a statement.
“Our technology helps hundreds of thousands of companies run their businesses. They use it to take orders, serve customers and work with partners,” it said.
Yandex shares were the biggest faller on the Moscow exchange, down 3.75%.
“The risks involve not only the potential temporary unavailability of Yandex services and lost revenue in specific segments but also the company’s extensive base of B2B clients,” said Maryana Lazaricheva, head of equity research at T-Investments.
She said the company could redistribute some of the load to its other data centers. “However, if the chain of attacks continues, this possibility vanishes, which could lead to even more severe consequences.”
The full scale of the disruption caused by the attacks was not immediately clear, although messages appeared on at least one Yandex app warning of potential problems in its operation.
Yandex said it was working around the clock to try to restore services that had been disrupted.
“Right now this is our most important task, but unfortunately it is not an easy one,” it said in the same statement.
Tit-for-tat strikes
Russia has struck Ukrainian data centers and telecommunications infrastructure over the past month, including targets in central Kyiv.
“We always respond in mirror-like fashion,” Ukrainian President Volodymyr Zelenskyy said on Thursday. “You all know, they have been hitting and continue to hit our data centers. We are responding. I can’t share all the details.”
Ukraine has previously targeted the warehouses of specific companies inside Russia which it deems central to Russia’s economy, including e-commerce giants Wildberries and Ozon, which then prompted Russia to strike their Ukrainian equivalents.
Yandex operates five data centers, two of which have already been hit. Two of the other three are in the Moscow region, and another is in the Vladimir region, according to publicly available information.
Yandex said in 2021 that the Sasovo data hub, which was struck on Thursday, hosted two of its three supercomputers built around Nvidia A100 chips, which it uses to train its YandexGPT large AI model. Yandex has declined to say whether the supercomputers were affected by the attack.
Multiple online services in Russia reported technical issues on Thursday, including real estate aggregator Cian, a book portal called Litmarket, and the websites of Russian Railways and professional football club Spartak Moscow.
Previous Ukrainian attacks on Russia have led to fuel shortages and queues at petrol stations, losses for tens of thousands of small businesses involved in e-commerce, and higher inflation as rising fuel costs feed through to consumer prices.
Russian attacks on Ukrainian data centers have forced some of them to suspend operations after sustaining damage, while 100,000 households suffered temporary internet outages after one attack.
Ukraine’s digital minister told Reuters last month that the country was moving digital infrastructure underground in response to Russian attacks.
Turkish solar technology manufacturer Kalyon PV said Thursday it plans to establish a new production facility in the United States as part of its global expansion strategy, targeting direct sales to the U.S. market and seeking to benefit from incentives supporting domestic manufacturing.
The company announced the investment at an investor meeting held Wednesday at its integrated manufacturing complex in Ankara, where it outlined its domestic and international growth strategy, production and technological capabilities, financial outlook and future targets.
The meeting was hosted by Kalyon PV Chair Murathan Kalyoncu and attended by investors and analysts, who also toured the factory to observe the production process, from ingots and wafers to solar cells and panels.
Under the planned investment, Kalyon PV intends to establish a new manufacturing facility through a U.S.-based partnership in which it holds a majority stake. The company has completed the establishment of the U.S. entity, according to its statement.
The facility is expected to manufacture solar panels and other products for the solar energy industry in compliance with relevant U.S. regulations and domestic-content requirements. The company also plans to establish a sales and marketing operation in the country to serve the market directly.
U.S. incentives
The United States has become a key market in Kalyon PV’s international growth strategy amid accelerating solar energy investment, rising demand and incentive mechanisms designed to support domestic production.
U.S. targets to substantially expand installed solar capacity by 2035, alongside advantages offered to local manufacturers, provide the strategic basis for the investment, the company said.
Kalyon PV is working with a U.S.-based consultancy on tax, legal and investment matters. It expects to pursue federal tax incentives as well as economic development incentives offered at state and local levels.
‘New era’
Kalyoncu said the company aimed to take the manufacturing experience and capabilities it had developed in Türkiye into international markets.
“Since our establishment, we have manufactured panels to meet the needs of our industry, particularly for the Kalyon Karapınar Solar Power Plant, one of Europe’s largest and among the world’s leading solar power plants,” he said.
Kalyon PV had continuously invested in research and development, technology and human resources, Kalyoncu said, adding that these efforts had helped the company achieve a series of milestones.
“Today, we are entering a new era in which we will take the experience and manufacturing strength we have built in Türkiye to global markets,” he said. “The company we have established in the United States is an important step in our international growth strategy.”
Each new investment strengthens the company’s production capabilities, while each new market supports its global expansion strategy, Kalyoncu said.
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