The renowned International Energy Agency (IEA), a leading global energy trend analyst for the past 50 years, has launched a new project focusing on the growing energy consumption of data centers to power artificial intelligence (AI) technologies.
In its recent midyear update report on global electricity trends, the IEA emphasized the increasing significance of AI in data center electricity usage, projecting a potential consumption of 1.5% to 3% of the world’s electricity generation by 2026.
To address the rapid growth in the data sector and the uncertainties surrounding future energy demands, the IEA has introduced the “Energy for AI, and AI for Energy” initiative. The agency will also host a global conference on this topic in Paris on December 5.
Major tech players like Google and Microsoft are grappling with meeting their climate targets due to the escalating energy requirements of AI. Recent sustainability reports from these companies reveal significant emissions increases, mainly driven by AI energy demands.
The IEA’s report notes varying estimates of data center energy utilization globally, emphasizing the need for deeper analysis and enhanced data transparency to address the sector’s energy demands effectively.
Factors such as economic growth, increased electrification, rising EV adoption, and climate impacts are collectively fueling the surge in global energy demand. The IEA forecasts a 4% growth in electricity demand in 2024 and another 4% in 2025.
Moreover, as the world witnesses rising temperatures, the demand for energy-intensive cooling systems is also on the rise. This energy demand surge coincides with a significant increase in renewable energy sources, with the IEA projecting a rise in the global electricity share from renewables to 35% by 2025.
Renewable energy is expected to surpass coal as the primary energy source for electricity generation next year, marking a significant milestone in the global energy transition.