Virtually all observers believe that electricity consumption by data centers is going to increase. But observers disagree about how much increase will happen, and where. Even estimates from the same entity can vary.
One report by the Electric Power Research Institute (EPRI) predicts data center electricity demand could grow by as little as 29 percent or as much as 166 percent from 2023 levels by 2030.
source: Frontier Group
So far as I am able to determine, nobody believes the challenge is insurmouintable, though lots of observers will disagree about precisely how to meet the new demand (renewable versus other sources; local versus remote generation).
Study | Date | Publisher | Key Estimates |
2024 United States Data Center Energy Usage Report | 2024 | Lawrence Berkeley National Laboratory (LBNL) | Data center load growth has tripled over the past decade. Projected to double or triple by 2028. Data centers consumed about 4.4% of total U.S. electricity in 2023. Expected to consume approximately 6.7 to 12% of total U.S. electricity by 2028. |
S&P Global Ratings Report on Data Center Energy Demand | 2024 | S&P Global | Incremental U.S. power demand from data centers could be 150-250 terawatt hours (TWh) between 2024 and 2030. This looming demand will require about 50 gigawatts (GW) of new generation capacity through 2030. Estimates incremental investment in generation and transmission at $60 billion and $15 billion respectively. |
AI, Data Centers, and the Coming US Power Demand Surge | April 2024 | Goldman Sachs | Estimates an additional 47 GW of power generation capacity needed to support U.S. data center power demand growth by 2030. |
How Data Centers Are Shaping the Future of Energy Consumption | June 2024 | Jefferies | Projects a 2.2-fold increase in power generation and transmission investments, reaching $280 billion by 2030, to meet data center energy demands. |
Data Centers: Rapid Growth Will Test U.S. Tech Sector's Decarbonization Ambitions | November 2024 | S&P Global | Predicts data center emissions could nearly double by 2030 due to reliance on gas-fired power generation to meet growing energy demands. |
What the Data Centre and AI Boom Could Mean for the Energy Sector | October 2024 | International Energy Agency (IEA) | Notes that annual investment in U.S. data center construction has doubled over the past two years, with tech giants' capital investments totaling around 0.5% of U.S. GDP. |
AI is Poised to Drive 160% Increase in Data Center Power Demand | May 2024 | Goldman Sachs | Estimates that data center power demand will grow by 160% by 2030, with current consumption at 1-2% of global power. |
Some have estimated capital investment ranging from $75 billion--$60 billion in generation and $15 billion in transmission infrastructure by 2030 to meet the additional demand. As always, “who pays?” will be debated, but ultimately, many stakeholders--investors, utilities themselves, data center end users and consumers will share the burden of higher generation and transmission investments.
Study | Date | Publisher | Key Estimates |
Data Centers: Surging Demand Will Benefit And Test The U.S. Power Sector | October 2024 | S&P Global Ratings | Estimates that meeting the incremental power demand from data centers will require about $60 billion in new generation capacity and $15 billion in transmission infrastructure by 2030. S&P Global |
Returning to Growth: US Power Demand Forecast Highlights Impact of Data Centers, EVs, and Solar | July 2024 | Enverus | Projects that data center load growth will add 153 GW of capacity by 2050 |
AI, Data Centers, and the Coming US Power Demand Surge | April 2024 | Goldman Sachs | Forecasts that U.S. data centers will consume 8% of U.S. power by 2030, up from 3% in 2022 |
EIA Projections Indicate Global Energy Consumption Increases | September 2023 | U.S. Energy Information Administration | Projects that primary energy consumption will increase by 16% to 57% by 2050 compared with 2022, with data centers being a significant contributor to this growth. |
The challenges will arguably be greater in some areas, such as Virginia, where so much of the global and U.S. data center operations occur.
source: Sherwood
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