The hidden bottleneck in the energy transition
- Andrea Quarteroni
- 15 Sep 2026
- 2 min
What you need to know
The energy transition is not just a question of generating more power. It is increasingly about delivering electricity where and when it is needed. As renewable energy, electric vehicles, batteries, and data centers reshape demand, traditional AC-based grids are struggling to keep pace. A hybrid AC/DC approach offers a practical path forward by reducing energy conversion losses, improving efficiency, and enabling buildings and distributed energy resources to play a more active role in balancing the grid. While adoption faces regulatory and infrastructure challenges, hybrid systems could become a critical enabler of a more resilient, efficient, and decarbonized energy future.
The global energy conversation often centers on scarcity. But the more immediate problem may be something subtler: timing.
In many parts of the world, there is enough electricity in total. The challenge lies in delivering it precisely when and where it’s needed. Power grids, built for a different era, are increasingly strained by surging demand, from electric vehicles and data centers to electrified buildings and industry.
According to the whitepaper Connecting AC with DC – The Future of Energy Transition, the result is a paradox: energy abundance coexisting with access constraints. In some regions, infrastructure has reached its limits, delaying new connections or forcing difficult trade-offs.
For over a century, electricity systems have relied on alternating current (AC) which is ideal for transmitting power over long distances from centralized power plants.
But the energy landscape has shifted.
Today’s system is increasingly:
- Decentralized (rooftop solar, storage, local generation)
- Digital (devices, data infrastructure)
- Dynamic (variable renewable output)
At the same time, many modern technologies, from batteries to electric vehicles, operate on direct current (DC). Yet the system continues to convert back and forth between AC and DC, introducing inefficiencies.
Rather than replacing one system with another, a more pragmatic approach is emerging: combining AC and DC into hybrid architectures.
Each serves a distinct role:
- AC remains effective for legacy transmission meshed infrastructure
- DC aligns naturally with local generation and light digital loads
When used together, the system becomes more efficient. Locally generated renewable energy such as solar power can be used directly in DC form, avoiding repeated conversions. This can introduce efficiencies and simplify integration with batteries and electric vehicles. In effect, the system begins to mirror how energy is actually produced and consumed today.
One of the most significant shifts is happening at the edge of the grid: buildings.
Traditionally passive consumers, buildings are evolving into “prosumers” — entities that both produce and use energy. With solar panels, storage systems, and increasing electrification, they can actively participate in balancing supply and demand.
In such environments, DC-based systems offer distinct advantages:
- More efficient integration of renewable sources
- Reduced energy loss from conversions
- Greater flexibility in managing local loads
Despite its promise, hybrid AC/DC adoption remains limited. The reasons are less technological than structural:
- Entrenched standards built around AC systems
- Limited expertise in DC infrastructure
- Perceived complexity and cost of change
- Regulatory gaps that lag behind emerging use cases
There is also inertia. The current system, while strained, is familiar—and large-scale infrastructure rarely changes quickly.
The transition toward hybrid systems is unlikely to be dramatic. It will unfold incrementally through pilot projects, building-level adoption, and evolving standards.
But its impact could be significant.
By aligning infrastructure with the realities of modern energy use like renewable, local, and digital, hybrid AC/DC systems offer a pathway to:
- Improve efficiency
- Reduce grid pressure
- Enhance resilience
- Accelerate decarbonization
The future of energy may not hinge on a single breakthrough technology, but on rethinking how existing ones work together.
Read the white paper "Connecting AC with DC – The Future of Energy Transition" and discover the practical pathways organizations can take to reduce energy losses, optimize distributed energy resources, and prepare for an increasingly electrified future.
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