Add the milk and beer to a large pot, bring to a gently simmer, slowly whisk in the grits. Allow to simmer gently, stirring occasionally, until tender, about 20 minutes.
Slowly whisk in the cheese, milk, salt, pepper, onion powder and butter, stir until completely combined.
In a separate pan add the pancetta and cook until browned and most of the fat has been rendered, do not burn. Add the sage and cook for about 30 seconds or until crispy. Drain.
Serve grits topped with pancetta and sage.