The Energy aspect of AI

The AI revolution is indeed shocking the world in several dimensions. Despite being in the early stages of practical applications, the amount of money that’s being poured into it, is accelerating the impact on society and creating distress in employment, equity valuations, countries competition, and energy consumption. It turns out the latter is quickly becoming the Achilles heel of the sector. In the chart below you can see the world electricity generation by source. The irony is that to power the most advanced technology the man has ever seen, we are currently, and for the foreseeable future, using the oldest and most basic form of energy. Fossil fuels (gas, oil and coal) account for half of energy generation in the world. And here lies the problem: the world produces 30000 Twatts/h and the AI data centers are expected to consume 2000Twatts/hour in 10 years. 6% of electricity generation will be needed only for data centers. That doesn’t include cars, cities, and other uses. Fossil fuels are a finite form of energy, and at some point we will run out of them. And the other sources of energy are not big enough, or efficient enough, to substitute the current ones, at the pace they’re currently being built. The world needs more nuclear plants, more solar and more wind, to take the baton from Nat gas. Furthermore, the current electrical grids need to be revamped, since they’re not ready to transport that amount of energy. That’s another angle of the AI race that will intensify over the coming years.

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