Smart Infrastructure the silent electrical revolution

Xavier Mongin

Strategist & Revenue Accelerator — Age of Intelligence

Why the transition from alternating current to direct current is already underway across many use cases — and why the industry has yet to talk about it openly.

Reading note
In this document, DC refers exclusively to direct current. Data centers are consistently referred to as data centers, never as DC.

In 1893, Nikothe Testhe and George Westinghouse won the “War of Currents” against Thomas Edison. Since then, the entire global electrical infrastructure has rested on alternating current — the wires in our walls, the distribution panels, the outlets in our offices. For 130 years, no one questioned this choice.

Today, those conditions have changed — not marginally, but fundamentally. A silent disruption is underway, driven by three forces converging simultaneously: the explosion in energy demand from artificial intelligence, the widespread adoption of solar and batteries, and the massive electrification of end uses. These three forces share one thing in common: they all operate natively on direct current.

The question is not whether DC will impose itself everywhere and uniformly — physics and economic realities show that AC retains advantages in certain contexts, particularly in existing buildings where the cost of conversion outweighs the benefit. The real question is who will be ready when it happens — and who will take the initiative to shape markets and decision-makers in favor of this disruptive technology where it genuinely applies.

Part 1 - Why

The problem everyone sees, but no one names

A hidden energy loss in every power outlet

Here is what is happening in your building right now, invisibly: the grid sends you alternating current. Your solar panels produce direct current — which is immediately converted to AC to travel through your cables. Your batteries store direct current — which was itself first converted from AC. And every device plugged in across your offices — computers, screens, phones, LED lighting, EV chargers — converts that AC back to DC to operate.

Four avoidable conversions. Each one dissipates between 3 and 8% of energy as heat. In a well-managed office building, between 15 and 25% of total energy is literally wasted — due to an electrical architecture designed at a time when solar panels and batteries did not exist. It should be noted, however, that a DC distribution system does not eliminate all conversion: DC also requires voltage adaptation at each point of use (from a 380V or 48V main bus down to the 5V or 12V needed by electronic equipment). These DC/DC conversions are nonetheless simpler, more compact, and less dissipative than the AC/DC stages they replace.

More than 70% of the world’s electricity, once generated as alternating current, ends up being converted back to direct current before it is consumed. We have built a global system to convert energy into a form we never actually needed.

AI: The unexpected accelerator

Artificial intelligence has put this issue under voltage — in every sense. The data centers running large AI models consume unprecedented amounts of energy. To put it concretely: a single next-generation AI server rack can consume as much power as around twenty homes. And that energy density doubles every two years.

At these levels, every conversion loss becomes critical. The major technology players — paying hundreds of millions of dollars in electricity bills — were the first to do the math. The result: the most advanced data centers are shifting to internal DC distribution, eliminating multiple conversion stages and gaining up to 5% in overall efficiency. On a site consuming 100 MW, that is 5 MW saved — enough to power 3,000 homes.

But what begins in data centers will not stop there.

Commercial buildings: The next frontier

A modern office building in 2026 increasingly resembles a mini energy network: rooftop solar panels, battery storage, EV charging stations, LED lighting, IoT sensors everywhere, algorithmically managed building systems. Every one of these elements operates natively on direct current.

The logic is compelling for new builds: rather than converting solar energy to AC for distribution, then converting it back to DC in every device, why not create an internal DC network that directly connects all these sources and uses? That is what DC microgrids do — internal electrical architectures that reduce superfluous conversions and intelligently coordinate production, storage, and consumption. For existing buildings, the calculation is more nuanced: replacing a functioning AC infrastructure represents a significant investment, and the energy savings may not justify the conversion cost in the short term. The relevance of DC is most clear-cut in new construction or deep renovations integrating solar and storage.

The global DC microgrid market was valued at $9.7 billion in 2025. It is expected to reach $50.6 billion by 2035, with annual growth of nearly 18%. [6]

Part 2 - How

A transition in four waves, already in motion

The transition to direct current will not happen overnight, nor will it be uniform. It follows a logic of successive waves, each making the next more natural and less costly.

First wave: Data centers (now)

This is where the transformation is most visible and best documented. The technology giants — driven by AI’s energy demands — are investing heavily in DC distribution architectures. Major collaborations between equipment manufacturers and chip makers are underway to develop 800-volt DC standards capable of powering one-megawatt racks. [1][3][4][5][17][15]

For non-specialists, the image is simple: imagine your building currently receives electricity like tap water, then filters it, treats it, and redistributes it through several different pipes before it reaches each device. The new architecture is a single high-quality main pipe that feeds each consumption point directly, without costly intermediate steps.

By 2028, 45% of new data centers are expected to adopt a DC distribution architecture. [2]

Second wave: Commercial buildings (2026–2030)

Offices, hospitals, hotels, airports, and university campuses are the natural candidates for the second wave. In these environments, the economic equation is already shifting: a building equipped with solar, batteries, and DC can save between 20 and 30% on energy consumption, reduce cabling by 50%, and operate autonomously during grid outages. [8][16]

What this really means

A DC microgrid building can disconnect from the main grid during an outage, a price spike, or a climate event — and continue operating normally using its own solar and battery resources. This is energy autonomy, not as an option, but as a baseline architecture.

Third wave: Urban networks and electric mobility (2027–2032)

EV charging hubs are natural convergence points for DC microgrids. A fast-charging station, a parking structure with solar canopy and battery storage: these elements already constitute a DC microgrid in the making. The next step is to eliminate the remaining AC distribution layer still present within these installations. [7]

At the scale of neighborhoods or business districts, DC district networks are beginning to emerge — notably in the Netherlands, South Korea, and China, where pilot projects demonstrate that an entire district can operate without the usual conversion losses.

Fourth wave: Long-distance transmission lines (2024–2040)

At large scale — thousands of kilometers — high-voltage direct current is already the reference technology for transporting energy from renewable production zones to consumption centers. China operates more than 50 such lines. The United States is developing similar projects to carry wind energy from New Mexico to California. [9][10][11]

The reason is physical: beyond 400 to 500 kilometers, alternating current loses too much energy in transit. Direct current, by contrast, maintains its efficiency over thousands of kilometers — with the added advantage of being able to connect grids operating at different frequencies.

Part 3 - What this changes

The industry is working — but not yet talking

Here is the most strategic observation in this analysis, and arguably the most important for decision-makers: the major players in building infrastructure are actively working on the DC transition. But none of them are saying so publicly — at least not when it comes to commercial buildings.

This silence is not ignorance. It is strategic caution — understandable, but temporary.

What is happening behind the scenes

The evidence of this behind-the-scenes work is extensive and concrete:

Schneider Electric is a founding member of Current/OS and the Open DC Alliance — two consortiums dedicated to DC standards. The company has developed an InterLink converter to bridge AC and DC networks, and has opened a dedicated DC experimentation center. [12][13]
Eaton presented its 800V DC architecture at the Open Compute Project conference in October 2025 and is co-developing solutions with NVIDIA for ultra-high-density AI racks. Its chief architect publicly stated: “A rhinoceros is coming — you need to widen the door in time.” [14]
Legrand, less often mentioned on this topic, has been participating since 2016 in the U.S. Department of Energy’s research program on DC buildings — alongside Cisco, Lawrence Berkeley National Laboratory, and other leading partners. [15]
Johnson Controls delivered one of the first large-scale commercial DC microgrid pilot projects — the largest in the world at the time — at a Honda distribution center in California. [16]
ABB, whose activities in DC microgrids and charging infrastructure are already well-documented, is also pursuing internal developments on the subject.

La disruption AC→DC est déjà en marche dans les laboratoires, les workgroups et les roadmaps produits des grands acteurs du secteur. Ce qui manque encore, c’est un narratif capable d’enclencher le mouvement, comme l’a fait l’industrie du véhicule électrique, et de fédérer les marchés ainsi que les donneurs d’ordres autour de cette nouvelle trajectoire technologique.

Why the silence — and why it will not last

The reason for this silence is easy to understand: the bulk of established players’ revenue rests on AC products and infrastructure — distribution panels, circuit breakers, cabling, inverters. Announcing that the competing architecture is superior means devaluing your own product catalog. No one has an interest in being the first to fire on their own installed base.

But this logic has a time limit. When the first major DC-certified buildings start displaying 20 to 30% energy savings, when energy performance labels integrate DC criteria, when real estate investors ask their managers why their building is still running unnecessary converters — the silence will become untenable.

And the players who spoke first — who named the disruption before it became obvious — will be those who built their legitimacy on this topic.

The role of standards: The decisive battle

The transition to direct current will not happen by technological decree. It will happen through standards — and that battle is being fought right now. Initiatives such as Current/OS, the EMerge Alliance, the Open Compute Project, and the work of IEEE and NEMA are defining the rules of the game for the next 50 years.

The companies and organizations that participate in this work — contributing to defining voltage levels, safety protocols, and product certifications — will have a considerable structural advantage over those who wait for published standards before reacting.

The question that already faces players in real estate, construction, and building management is this: will you participate in writing these standards, or will you discover them once they are published?

What leaders need to understand — and decide — now

Executive Summary

The transition from alternating current to direct current is not a working hypothesis for 2035. It is a reality already being deployed in data centers, an economic logic already demonstrated in several pilot buildings, and a standardization effort playing out right now in international technical committees. This transition will not be uniform: AC will remain relevant in many existing contexts, and DC does not eliminate all conversion — it reduces the number and impact of conversions. The gains are most significant and immediate in new construction and high energy-density environments.

Four strategic priorities for acting now:

Construction and renovation: Every construction or major renovation project starting in 2025–2027 must integrate DC compatibility from the design phase — not as an option, but as infrastructure ready to accommodate change without additional works.
Systemic integration: Organizations that treat energy, storage, electric mobility, and digital systems as separate silos will miss the transition. The challenge is to integrate these components into a unified architecture — which direct current makes natural.
Standards: The next 18 to 24 months are decisive for standards. The companies that participate in their development — in technical working groups, sector alliances, and standardization committees — will define the market rules of tomorrow. The rest will have to live with them.
The role of the expert: The more complex the transition — existing building, mixed energy sources, regulatory constraints — the more critical the role of an independent expert. Neither equipment manufacturers nor generalist engineering firms are in a neutral position on these choices. Engaging specialists who master the physics of DC networks, the economic models, and the standards currently being developed is a strategic decision in its own right.

The War of Currents was settled in 1893. It is being refought today — and this time, physics, economics, and climate urgency all point in the same direction — not to replace AC everywhere overnight, but to make DC the natural choice for any energy infrastructure designed for the next 30 years.

Sources & References

Réf.	Source	Date	URL
[1]	In Edison's Revenge, Data Centers Are Transitioning From AC to DC IEEE Spectrum	Mar. 2026	spectrum.ieee.org/data-center-dc
[2]	2026 Data Center Power Report Bloom Energy	Jan. 2026	bloomenergy.com/2026-power-report
[3]	How Data Centers Redefined Energy and Power in 2025 Data Center Knowledge	Dec. 2025	datacenterknowledge.com/…/how-data-centers-redefined…
[4]	Will the Data Center of the Future Be AC or DC? Data Center Knowledge	Aug. 2025	datacenterknowledge.com/…/current-debate-will…
[5]	Rethinking Energy: How Data Centers Are Adapting to Grid Constraints Data Center Knowledge	Feb. 2026	datacenterknowledge.com/…/rethinking-energy…
[6]	Global DC Microgrid Market Report Market Research / One-Off Global Market Insights	Feb. 2026	marketresearch.com URL exacte non trouvée
[7]	Exploring DC Microgrid: Advanced Applications and Their Control Strategies ScienceDirect	Apr. 2025	sciencedirect.com/…/S2950487225000066
[8]	Energy Efficiency: The Rise of DC Microgrids Buildings.com	2025	buildings.com/…/energy-efficiency-the-rise-of-dc-microgrids
[9]	Connecting the Country with HVDC U.S. Department of Energy	2024	energy.gov/oe/articles/connecting-country-hvdc
[10]	Harnessing HVDC Transmission as a Transformative Force in Modern Grid Design Utility Dive	May 2025	utilitydive.com/news/hvdc-transmission…/747435
[11]	Building the Future Transmission Grid IEA	2025	iea.org/reports/building-the-future-transmission-grid
[12]	Direct Current Alliances aim to accelerate the energy transition through DC Microgrids Schneider Electric	Jul. 2025	blog.se.com/…/direct-current-alliances…
[13]	Direct Current for Smarter Energy Schneider Electric	Nov. 2025	se.com/…/direct-current-powering-the-path…
[17]	In Edison's Revenge / Data Center DC Embraces 800V Power Shift IEEE Spectrum	Mar. 2026	spectrum.ieee.org/data-center-dc
[14]	Eaton Unveils Next-Generation Architecture to Advance 800 VDC Power Infrastructure for AI Factories Eaton	Oct. 2025	eaton.com/…/eaton-unveils-next-generation-architecture
[15]	Legrand: 2025 Full-Year Results Legrand (via Business Wire)	Feb. 2026	businesswire.com/news/…/20260211453334
[16]	OpenBlue Net Zero Buildings as a Service Johnson Controls	2025	johnsoncontrols.com/openblue/net-zero-buildings Lancé en 2021