For a heavy plant, the power connection now decides the site

Ask a steel CFO what limits output and you will still hear scrap, electrodes, and orders. Ask again after a winter of industrial power prices and you will hear the grid. Electric-arc furnaces, aluminium smelters, semiconductor fabs, and battery dry rooms are now competing with data centers for interconnection. In more than a few regions, the queue is the strategy.

This is new in degree, not in kind. Heavy industry always followed energy. What is new is the simultaneity: AI campuses, EV plants, and reshoring projects all arriving at substations that were sized for a quieter decade. Small modular reactor startups raised nearly $4 billion in 2024. That is a tell. When manufacturers start talking like utilities, the constraint has moved.

Site selection is a megawatt model

Boards still approve plants on labour, logistics, and incentives. The plants that will actually run through 2030 are the ones that modelled firm power — including the 2 a.m. price — before they modelled the break-room. Behind-the-meter generation, long-term PPAs, and the unfashionable option of simply not building in a congested node are now operating decisions. So is demand response. A line that can shed load without scrapping a batch has a different P&L from one that cannot.

A gigafactory without a substation date is a rendering. Treat the interconnection agreement with the same gravity as the tool purchase order.

Emissions accounting is tightening at the same moment. TechInsights expects semiconductor fabrication emissions to approach 200 million metric tons of CO₂e this year, with Taiwan, South Korea, and China doing most of the growing. Complexity is the driver: more silicon, more packaging, more energy per good die. The manufacturers who will still have a licence to operate in Europe are the ones who can show the electron as well as the part.

200 Mt

Projected 2026 semiconductor-fab CO₂e

$3.9bn

SMR startup funding in 2024

24/7

The only power profile a fab can actually use