May 30, 2024 - Energy & Environment

AI data center demand poised to juice U.S. power needs

A U.S. map shows the projected data center share of 2030 electricity use, assuming the average of four growth scenarios and that non-data center loads grow at 1% annually. Data centers in Virginia are projected to take 36% of the electricity share. North Dakota is second highest, projected at 23%. Seven states are projected to see shares between 10% and 20%. 35 states are projected to see shares of less than 10%. Seven other states are projected at zero.
Adapted from EPRI; Map: Axios Visuals

New projections help crystallize a huge challenge: meeting the surging energy needs of data centers as artificial intelligence joins other forces pushing up U.S. power demand.

Why it matters: The balance of fuels that meet this added thirst — gas, renewables, coal, batteries, nuclear and more — will sway future carbon dioxide emissions.

Driving the news: The Electric Power Research Institute sees these digital hubs draining between 4.6%-9.1% of U.S. electricity in 2030, based on four scenarios.

  • Last year it was 4%, the nonprofit's new report states.
  • It's very regional too — the state-by-state graphic above averages their four growth cases.
  • Today, data centers in 15 states account for 80% of the total.

Stunning stat: "At 2.9 watt-hours per ChatGPT request, AI queries are estimated to require 10x the electricity of traditional Google queries," EPRI finds.

  • Emerging AI video, image and audio applications "have no precedent."

What we're watching: Which energy sources are used to meet energy thirst from AI, new manufacturing, EVs and more.

  • Tech companies like Google and Microsoft are big players in zero-carbon energy purchase deals.
  • But a new TD Cowen report projects "75-100% of incremental U.S. data center load growth in the near to medium-term will be supported by natural gas."

Context: A recent Goldman Sachs analysis sees data centers driving over a third of what they project will be 2.4% compound annual growth rate of U.S. power demand through 2030.

  • Goldman projects these hubs using 8% of U.S. electricity by then, and assumes a 60/40 split between gas and renewables in meeting new demand growth for this infrastructure.

State of play: EPRI calls for a multipronged strategy that includes efficiency gains, but they warn that since 2018, these improvements have slowed.

What's next: EPRI's working with the data center industry and utilities to explore sustainable approaches.

  • One of the ideas: backup generators powered by "clean fuels" that help move the data center-grid relationship from a passive one to a "shared energy economy."
  • That means "grid resources powering data centers and data center backup resources contributing to grid reliability and flexibility."
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