Electricity consumption by data centres is set to more than double by 2030, fuelled by the rapid growth of artificial intelligence (AI) technologies, according to a new report released Thursday by the International Energy Agency (IEA). The surge presents fresh challenges to energy security, carbon emission targets, and global electricity infrastructure.
At the same time, the IEA notes that AI holds promise for improving how electricity is produced, distributed, and consumed.
“Artificial intelligence has the potential to transform the energy sector in the coming decade,” the report stated, “driving a surge in electricity demand from data centers worldwide, while also unlocking significant opportunities to cut costs, enhance competitiveness, and reduce emissions.”
Global Data Centre Power Use Already on the Rise
In 2024, data centres accounted for approximately 1.5% of global electricity consumption, with usage increasing by around 12% annually over the past five years. Much of this growth is attributed to generative AI, which requires intensive computing power to process vast datasets.
Currently, the United States, Europe, and China account for about 85% of global data centre electricity consumption.
Big Tech Turns to Nuclear Energy to Power AI Ambitions
As AI applications expand, tech giants are increasingly investing in alternative energy sources to meet growing demands.
- Google signed a deal in 2024 to source electricity from small nuclear reactors.
- Microsoft plans to use energy from new reactors at Three Mile Island, the site of the infamous 1979 nuclear meltdown.
- Amazon also signed an agreement last year to power its data centres with nuclear energy.
At this pace, global data centres will consume around 3% of total electricity by 2030, according to the IEA.
“This is slightly more than Japan’s total electricity consumption today. AI is the most important driver of this growth, alongside growing demand for other digital services,” the report added.
One Data Centre Can Power 100,000 Homes—or More
A single 100-megawatt data centre can consume as much electricity as 100,000 households. The IEA warns that larger centres already under construction could require energy equivalent to two million homes.
The agency projects total data centre electricity consumption to reach 945 terawatt hours (TWh) by 2030.
Can Renewable Energy Keep Up With AI?
While coal currently supplies around 30% of the energy used by data centres, renewable energy sources and natural gas are expected to make up a larger share moving forward, thanks to lower costs and wider availability.
Still, the environmental cost remains a concern. The IEA predicts that CO₂ emissions from data centres will rise from 180 million tonnes today to 300 million tonnes by 2035. This figure, however, remains a small portion of the 41.6 billion tonnes of global CO₂ emissions estimated in 2024.
U.S. Launches ‘National Council for Energy Dominance’
In a bid to stay ahead in the AI race, U.S. President Donald Trump has announced the creation of a “National Council for Energy Dominance,” focused on increasing domestic electricity production.
The IEA’s report paints a complex picture: AI is both a threat and a solution. While it is set to dramatically increase power demand, it may also help optimize grid management, enhance energy efficiency, and reduce long-term costs.
As nations and companies race to harness AI’s potential, balancing energy demands with sustainability goals will be critical in the years ahead.