In Short : Artificial intelligence could account for nearly 20% of global incremental power demand by 2030, driven by the rapid expansion of data centres, high-performance computing, and AI-intensive applications. Rising energy needs are prompting utilities, governments, and technology companies to rethink power generation, grid infrastructure, and sustainability strategies to ensure reliable, efficient, and low-carbon electricity supply.
In Detail : Artificial intelligence is emerging as a major driver of future electricity demand, with reports suggesting it could contribute up to 20% of incremental power consumption by 2030. The rapid adoption of AI across industries is significantly increasing energy requirements, particularly from data centres and advanced computing infrastructure.
The expansion of AI-powered data centres is central to this trend. Training large language models, running complex algorithms, and supporting real-time AI applications require enormous computing power, translating into substantial and continuous electricity consumption.
High-performance computing systems used for AI workloads consume far more energy than traditional IT infrastructure. As companies scale up AI capabilities, the density of servers and cooling requirements in data centres is rising, further amplifying power demand.
This growing electricity consumption is placing new pressures on power grids. Utilities are facing challenges in ensuring adequate generation capacity, upgrading transmission networks, and maintaining grid stability while meeting the concentrated and location-specific demand from large data centre clusters.
The report also highlights sustainability concerns linked to AI-driven power growth. Without careful planning, increased reliance on fossil fuels could undermine climate targets, making the integration of renewable energy and energy storage solutions increasingly important.
In response, technology companies are exploring long-term power purchase agreements, on-site renewable generation, and battery storage to secure clean and reliable electricity supplies. These strategies are helping align AI growth with broader decarbonisation goals.
Governments and regulators are also being called upon to adapt policies and planning frameworks. Proactive grid investments, streamlined approvals, and supportive regulations can help accommodate AI-driven demand while minimising system-wide risks.
Efficiency improvements in both hardware and software are expected to play a key role in moderating power consumption. Advances in chip design, cooling technologies, and AI algorithms could reduce energy intensity even as overall computing activity continues to grow.
Overall, the projected contribution of AI to incremental power demand underscores the need for coordinated action between the energy and technology sectors. Strategic planning, innovation, and sustainable energy integration will be essential to support AI’s growth without compromising energy security or climate objectives.
