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  • Writer's pictureRealFacts Editorial Team

The Potential Electricity Demand Needed For AI


Electricity

The world is in the midst of the AI craze, companies are slapping the AI label on everything in order to meet the demand the market has for AI products and services. One aspect of this mania that most people haven’t looked at is the electricity that will be needed to support AI development and implementation. The below chart was shown in a presentation by Ben Fowke, CEO of American Electric Power Company, it highlights the potential increase in national electricity demand over the following years due to AI:


Summary of GenAI demand forecast

 

As the chart shows, demand for terawatt-hours is going to increase from 8 hours this year, to 652 hours by 2030. Fowke said in his presentation, “Demand for electricity was almost flat for two decades. We are now beginning to see this trend reverse — driven by large customers such as industrial manufacturers, data processors and others who require significant amounts of power,” Needed for AI expansion is a large amount of data processing centers across the world, these centers require an unreal amount of electricity. Fowke gave a small example, citing the fact that a ChatGPT search requires 2.9 watt-hours per search, which is ten times what is needed for the average Google search.

 

Some investors are looking at this as a golden opportunity, they have begun to invest in utilities as a way to indirectly invest in the AI industry. AI is here to stay, and it is going to continue to increase in demand and need as major companies implement it every way they possibly can, utilities will most likely rise along with it.

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