This is one outlet's own report from Quartz — the article as it was filed.
AIPROPX ReportQuartz · 3h ago
Data centers are using more electricity than anyone predicted. What happens next?
For almost two decades, total U.S. electricity demand barely grew. The country kept adding people and businesses that needed power, but Americans were using electricity more efficiently, and the savings canceled out all that growth. Data centers broke the pattern. A single large facility can draw as much electricity as a small city, and the industry has been building them so fast that utilities are now planning for far more power than they expected.
Data centers consumed about 176 terawatt-hours of electricity in 2023, enough to power roughly 17 million homes, according to Lawrence Berkeley National Laboratory . Five years earlier, data centers ate up less than half that amount. The Electric Power Research Institute projects that data centers could account for 9% to 17% of all U.S. electricity by 2030, more than doubling their current share even in the most conservative scenario.
Every year, the projections get larger. In 2023, the North American Electric Reliability Corporation projected that the country would need 80 additional gigawatts of electricity over the next decade. One year later, it revised the figure to 132 gigawatts, a 65% increase. New power plants take years to permit and build, and in the states where data center construction is furthest along, utilities can't build fast enough to keep up.
Globally, data center electricity consumption has grown at about 12% per year since 2019, reaching an estimated 415 terawatt-hours in 2024, nearly as much electricity as France uses in a year, according to the International Energy Agency . The IEA expects consumption to roughly double to 945 terawatt-hours by 2030, growing four times faster than electricity use in any other sector.
Nearly 80% of the projected growth through 2030 falls on the United States and China. U.S. data center electricity use alone is expected to more than double, with China facing a comparable surge. Even Europe, which accounts for a much smaller share of the total, faces a projected 70% increase. A small number of regional electricity systems in two countries will have to find and deliver most of the new power the world's data centers need.
In the U.S., how much power those systems will actually have to deliver is far from clear. The EPRI's low-end projection for 2030, about 380 terawatt-hours, would roughly double current data center electricity use. Its high-end projection of 790 terawatt-hours — enough electricity to power roughly 75 million American homes — would more than quadruple it. The problem is that utility companies have to decide now what power plants to build, and the forecasts they're planning around are best estimates rather than solid data points. Whatever they commit to today will take years to come online, and the numbers could look very different by then.
The difficulty, too, is that AI is taking over data centers that were built for something else. Cloud computing and routine business tasks such as email and file storage still make up the majority of what data centers do, but their share is falling fast. Goldman Sachs $GS Research estimates that AI could account for more than a quarter of global data center power demand by 2027, up from 14% today, as companies pour more of their computing into massive AI-focused facilities run by Amazon $AMZN , Google $GOOGL , and Microsoft $MSFT .
Because each new generation of AI chips is more powerful and more power-hungry than the last, a single server rack now consumes about 11 times what it did five years ago, according to the IEA. AI-equipped servers are being added on top of a decades-old fleet that serves much simpler needs, and they still account for a small share of all the world's data center components. But the IEA still expects these servers to drive close to half the growth in global data center electricity use through the end of the decade.
Cryptocurrency miners draw from the same grid but aren't counted in most data center statistics. The Energy Information Administration estimated in early 2024 that Bitcoin mining alone consumed between 25 and 91 terawatt-hours in the U.S. in 2023, or 0.6% to 2.3% of total electricity demand, respectively. The estimate covered only Bitcoin and excluded other cryptocurrencies that use the same energy-intensive mining process, so the actual total is likely higher. In states like Texas, where both AI data centers and crypto miners are expanding fast, the two industries compete for the same grid capacity.
Virginia services a lot of electricity demand on its own. Taking advantage of the state's cheap land, fast permitting, and available power, developers clustered data centers there, and now more than a quarter of Virginia's electricity goes to them. Virginia would need to double its total electricity supply within the next 10 years if every planned data center project were to move forward, according to a December 2024 forecast by the Virginia Joint Legislative Audit and Review Commission .
The strain goes far beyond Virginia. The PJM Interconnection , which coordinates electricity for 13 eastern and midwestern states, expects peak summer demand to reach about 210,000 megawatts by 2035, far beyond the system's all-time high of about 167 gigawatts, set in 2006. When demand grows faster than the grid can expand, electricity gets more expensive for everyone connected to it.
Even if Virginia is now running low on capacity, it long had the grid infrastructure to absorb the early years of data center growth. The states next in line may not. By 2030, Arizona, Indiana, Iowa, Nebraska, Nevada, Oregon, and Wyoming could see data centers take up a fifth or more of their electricity, according to the EPRI . Several of those states have small populations and grids built for rural and agricultural demand, not for facilities that draw as much power as small cities. Customers will see even bigger energy bills there.
After 15 years of essentially flat consumption, the country is using more electricity each year, ...
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