Samsung bets this island startup can tame the grid with software and batteries

The past decade has seen more transformation in the electrical grid than the previous fifty years. Solar, wind, and battery technologies have shifted power generation from large, centralized producers. Yet, the grid continues to face persistent challenges.

“The grid’s issue is primarily a peak problem. Generally, you have sufficient power, but during peak hours, there might not be enough,” Michael Phelan, co-founder and CEO of GridBeyond, explained to JS.

Currently, these power shortages are most pronounced for tech firms and data center developers, who require substantial electricity to train and run AI models.

“If you have ample energy stored in a battery or can reduce an industrial load by hundreds of megawatts, then you can start developing those hyperscalers,” Phelan noted.

GridBeyond has been innovating with hardware and software to integrate various grid components into larger virtual power plants. The startup manages approximately 1 gigawatt of solar, battery, wind, and hydropower, and on the demand side, it oversees “several gigawatts” across commercial and industrial sites, according to Phelan.

To broaden its offerings, GridBeyond recently secured a €12 million ($13.8 million) equity round led by Samsung Ventures, as shared exclusively with JS. Other investors include ABB, Act Venture Capital, Alantra’s Energy Transition Fund, Constellation Technology Ventures, EDP, Energy Impact Partners, Enterprise Ireland, Klima, Mirova, and Yokogawa, a Japanese electronics and software company.

The company has deployed its hardware controllers in batteries and renewable energy facilities, as well as in large commercial and industrial sites in Australia, Ireland, Japan, the U.K., and the United States.

Like many virtual power plant firms, Dublin-based GridBeyond began its journey on an island. As Ireland increased its wind power capacity, Phelan recalled, “they encountered a challenge being an island, needing to balance the grid. It was ideal for them to implement flexible loads in the market.”

Grid operators have long encouraged heavy users to reduce power usage during extreme heat waves, offering significant payments for peak demand reduction. This approach is more cost-effective than constructing new transmission lines or power plants. As renewable energy has grown, this practice has expanded, enabling industrial and commercial clients to decrease consumption at night or when wind energy production declines.

Recently, batteries have introduced a new aspect. GridBeyond oversees several substantial energy storage projects, including a 200-megawatt battery in California, providing flexible supply to fill gaps from renewable sources.

Batteries offer another benefit: they respond more quickly to demand than traditional peaking power plants, which require minutes to activate. This capability allows the company to engage in power trading rapidly, performing arbitrage.

This also creates new opportunities for data centers. Many data centers do not draw power consistently, instead experiencing spikes during AI training sessions. Such fluctuations can destabilize the grid, as seen in the Spanish grid collapse—an event no one desires, Phelan remarked. Batteries at data centers can absorb much of this load, stabilizing the facility’s grid profile to prevent unwanted disturbances.

By connecting to a nearby virtual power plant or installing batteries on-site, “it becomes easier for them to establish connections,” he said.

Update 5:30 pm ET: The article was revised to specify that the investment was from Constellation’s venture division, Constellation Technology Ventures.