The rapid rise of artificial intelligence is set to dramatically reshape global energy demand. According to the International Energy Agency (IEA), electricity consumption by data centres is expected to more than double by 2030 — a shift that will pose new challenges for energy security and climate goals.

AI as a Major Driver of Energy Consumption

In its first report examining the energy impact of AI, the IEA highlighted the massive energy needs of generative AI systems. These systems rely on immense computing power to process and analyze data from large-scale databases. As a result, the global energy footprint of data centres is growing fast — about 12% annually over the past five years.

In 2024, data centres accounted for 1.5% of global electricity usage, but if current trends continue, they will consume approximately 3% by 2030. That translates to roughly 945 terawatt-hours (TWh) — slightly more than Japan’s total electricity consumption today.

Global Powerhouses and Energy Demands

The United States, Europe, and China currently represent around 85% of data centre electricity usage, with tech giants racing to secure enough power to keep their AI infrastructure running.

To meet rising energy demands:

• Google has partnered with providers of small nuclear reactors.

• Microsoft plans to use nuclear energy from reactors at Three Mile Island, famously known for the 1979 nuclear incident.

• Amazon has also signed deals to power its data centres with nuclear energy.

These moves show how tech companies are seeking long-term, low-carbon energy sources as AI workloads increase.

Opportunities for Efficiency Amid Rising Emissions

Despite the spike in energy use, the IEA notes that AI can also help optimize electricity production and consumption, potentially improving overall energy efficiency in the long run.

Still, the rise of data centres will impact global carbon emissions. The IEA projects emissions linked to data centre electricity consumption will climb from 180 million tonnes of CO2 today to 300 million tonnes by 2035. However, this still accounts for a small share of the 41.6 billion tonnes of global emissions recorded in 2024.

The shift in energy sourcing is also encouraging. While coal currently supplies about 30% of the energy for data centres, renewables and natural gas are gaining ground due to their cost-effectiveness and broader availability.

Policy and Global Strategy Implications

In the U.S., energy policy is beginning to respond to the AI revolution. Former President Donald Trump, seeking to outpace China in AI development, had initiated the formation of a “National Council for Energy Dominance” aimed at ramping up electricity production.

This focus underscores the growing realization that AI’s progress is now deeply intertwined with global energy policy and sustainability strategies.

Looking Ahead

As AI technologies continue to evolve, the energy infrastructure supporting them must also adapt. The IEA report serves as a critical reminder: while AI can unlock new efficiencies, it also demands a balanced approach to ensure sustainability, grid reliability, and climate responsibility.

Governments, energy providers, and tech companies will need to work together to ensure that the digital future does not come at the cost of the planet.

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