Power Supply The Importance of Direct Current in Future Power Systems Is Growing

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As ABB and the Boston Consulting Group point out, the expansion of AI computing capabilities and increasing electrification are also bringing DC technologies back into sharper focus. In buildings and industrial facilities in particular, many energy sources and consumers already rely on direct current.

ABB, in collaboration with the Boston Consulting Group (BCG), has published the report titled “The Strategic Case for Hybrid AC/DC Power: Shaping the Transition to the Next Electrical Architecture”. According to the report, direct current (DC) technology will evolve from a niche application into a central component of industrial, commercial, and digital infrastructures. The decisions made by businesses and policymakers over the next two to three years will play a decisive role in determining who will actively shape this transformation—and who will later have to adapt to the framework conditions created by others.

The future of power distribution is not about choosing between alternating current and direct current. Rather, hybrid systems will combine the advantages of both technologies. While alternating current will continue to form the backbone of most transmission and regional distribution grids, direct current is likely to play an increasingly important role within buildings and industrial facilities, as many energy sources and consumers there are already based on direct current. These include photovoltaic systems, battery storage, electric vehicles, AI data centers, and industrial automation systems—all of which are among the fastest-growing technologies. As these technologies become more widespread, the number of conversion steps between generation, storage, and consumption can be reduced, thereby increasing efficiency, expanding the capacity of existing grid connections, and simplifying the integration of energy systems.

Direct Current for AI Infrastructure

According to the report, AI data centers are a key driver for the adoption of direct current technologies. As AI applications require ever-higher power densities, conventional electrical architectures are increasingly reaching their limits. Consequently, 800-volt DC power distribution is emerging as the leading architecture for the next generation of AI infrastructure. It enables operators to provide more computing capacity despite limited grid connection capacity, while simultaneously improving energy efficiency.

However, the increasing use of direct current technologies is not limited to data centers. The report also identifies significant potential in numerous other industries. For example, direct current offers advantages in highly automated production facilities and commercial buildings—and, in the long term, in buildings in general. These include lower conversion losses, more effective integration of renewable energy and on-site energy storage, and greater operational flexibility.

Harnessing the Benefits of Alternating and Direct Current

“Electricity demand is growing. At the same time, the existing infrastructure is reaching its limits. To expand the use of DC systems, businesses, policymakers, and technology providers must work more closely together and give greater consideration to the potential of DC,” said Morten Wierod, CEO of ABB. “For more than 25 years, ABB’s DC solutions have been helping our customers reduce conversion losses, improve power transmission efficiency, and lower electricity demand. To accelerate broader adoption where the economic benefits are most evident, we need shared technologies, uniform standards, and a sufficient number of qualified professionals to implement these solutions on a large scale. AC and DC each have their own strengths. Together, they enable a more efficient, resilient, and sustainable power system.”

In the report, ABB and BCG address long-standing reservations that have so far hindered the adoption of direct current technologies. According to the report, concerns regarding scalability, safety, and cost-effectiveness are based on increasingly outdated assumptions and no longer adequately reflect the capabilities of today’s technologies. The main obstacles to the faster adoption of DC technologies are inconsistent standards and a lack of specific technical expertise. There is an urgent need for action in both areas.

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