Artificial intelligence’s thirst for electricity is conspiring with other factors to trigger a sharp spike in electricity demand that the U.S. is only beginning to address.
Why it matters: How lawmakers, utilities, regulators and tech companies manage this trend may determine whether America’s emissions reduction goals are met, with more fossil fuel-powered plants under consideration in the near term.
At the same time, the rise of generative AI, which requires far more compute power than typical cloud computing functions, is also contributing to unheard of growth rates in electricity demand for utilities — particularly ones that serve large numbers of data centers.
- However, while generative AI requires more electricity, this technology and others could be enlisted to help make data centers more flexible in how they use electricity, rather than constantly running near peak demand.
The big picture: Call it the dark side of the push to electrify everything, from cars to water heaters, incentivized by President Biden’s landmark climate law.
- While beneficial in the fight against climate change, such shifts are adding to demands on a grid that was already showing signs of strain.
Zoom in: Take Dominion Energy, for example, which provides electricity to the hundreds of data centers comprising “data center alley” in northern Virginia.
- The utility is still fully committed to generating 90% to 95% of its electricity from carbon-free sources, according to a company spokesperson.
- But ravenous data center and residential needs call for installing more baseload power stations that can be reliably dispatched when renewable sources ebb, the company official said.
- This is leading to planning for new natural gas plants, which burn fossil fuels and can add to global emissions.
By the numbers: Other utilities are facing the same quandary. Georgia Power, for example, has increased its projected load growth from about 400 megawatts in January 2022 to 6,600 MW more recently.
Threat level: Generative AI is unlikely to bring down the grid any time soon. But it is forcing data center companies, the Energy Department, utilities and utility regulators to get creative.
- Energy Secretary Jennifer Granholm told Axios in March that electricity’s AI-driven boost is something that worries her, given the potential to undermine the administration’s climate goals.
- She tasked the department’s science advisory board with presenting its latest thinking on this issue, which it did on April 9, showing the data center industry as being on the cusp of its third wave of growth.
The intrigue: David Porter, vice president of electrification and sustainable energy strategy at EPRI, told Axios the biggest challenge facing utilities is building new infrastructure to meet rapidly growing energy demands.
- This is partly because it can take a decade in the U.S. to approve new transmission lines, whereas data centers can be approved and built within 18 to 24 months.
- “Those two things do not align very well,” Porter said in an interview.
Context: Many of the major tech companies advancing generative AI have committed to lofty sustainability targets, and they are signing deals with clean tech startups for advanced carbon-free energy options.
What they’re saying: With AI compute converging with other demands, “We’re almost in the perfect storm for the demand for green electrons,” Christopher Wellise, VP of sustainability at data center firm Equinix, told Axios
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