AI energy demand drives interest in second-hand turbines and jet engines
Technology companies are turning to used gas turbines and retired aircraft engines to secure electricity for expanding data centres.
Technology companies are exploring the market for second-hand gas turbines and retired aircraft jet engines to power artificial intelligence (AI) infrastructure, according to a report by Reuters cited by the Times of India.
The rapid expansion of AI data centres has created a shortage of power-generation equipment. These facilities require continuous and reliable electricity to run high-performance processors and cooling systems.
Manufacturers are struggling to meet demand, with delivery timelines for new equipment stretching as long as six years in the United States. This has pushed developers to look at on-site electricity generation to avoid delays from waiting for grid connections.
Global turbine orders have crossed 100 gigawatts (GW), while annual manufacturing capacity is between 60-70 GW, according to estimates from Wood Mackenzie cited by Reuters. Global demand could reach 129 GW by 2028, while capacity is expected to rise to only 87 GW.
The second-hand market is becoming an attractive option due to cost and availability. Used turbines are reportedly selling for $1.5 million to $1.7 million per megawatt (MW), while refurbished units cost around $1.3 million per MW. New equipment costs between $2 million to $2.5 million per MW.
The demand is benefiting major manufacturers including Siemens Energy, GE Vernova, and Japan's Mitsubishi Heavy Industries. The shortage is also creating business opportunities for companies that specialise in sourcing, repairing, and reselling older machinery.