How AI Is Sparking a Change in Power

By Tae Kim  Original March 14, 2024, 12:01 am EDT

Source: AI Is Changing the Future of Energy. What to Know. - Barron's (barrons.com)

Elon Musk recently made a bold prediction about artificial intelligence—and not the one about it being an existential threat to humanity. Musk said rising demand for power-hungry AI chips could soon lead to an electricity shortage. “Next year, you will see that they just can’t find enough electricity to run all the chips,” the Tesla CEO said at the Bosch ConnectedWorld conference late last month.

While AI’s surging demand may not lead to mass electrical outages, the AI boom is already changing how data centers are built and where they’re located, and it’s already sparking a reshaping of U.S. energy infrastructure. Energy companies increasingly cite AI power consumption as a leading contributor to new demand. AES, a Virginia-based utility, recently told investors that data centers could comprise up to 7.5% of total U.S. electricity consumption by 2030, citing data from Boston Consulting Group. The company is largely betting its growth on the ability to deliver renewable power to data centers in the coming years.