AI contributing to doubled data centre electricity consumption
Using artificial intelligence means a dramatic increase in electricity consumption. Global data centres electricity consumption will more than double between 2023 and 2028 with a five-year CAGR (compound annual growth rate) of 19.5% and reaching 857 Terawatt hours (TWh) in 2028, according to a forecast by market research firm International Data Corporation (IDC).
Big techs spend huge amounts on developing artificial intelligence services. One critical issue is energy costs for the data centres to be followed by major energy demands when many millions start using various AI features.
“ Data centres are the heart of the digital economy and the demand for data centres is expected to rise substantially, positioning them as a primary focus for growth and investment. But the cost of operating data centres is also rising substantially due to rising electricity prices and increased data centre consumption”, the IDC forecast says.
“Electricity is by far the largest ongoing expense for data centre operators, accounting for 46% of total spending for enterprise data centres and 60% for service provider data centres. And electricity consumption is growing rapidly as data centres take on more workloads and more energy-intensive workloads, such as artificial intelligence.”
IDC expects the surging demand for AI workloads will lead to a significant increase in data centre capacity, energy consumption, and carbon emissions, with AI data centre capacity projected to have a CAGR rate of 40.5% through 2027.
Accordingly, AI data centre energy consumption is forecast to grow at a CAGR of 44.7%, reaching 146.2 Terawatt hours (TWh) by 2027 with AI workloads consuming a growing portion of total data centre electricity use.
“At the same time, electricity prices are rising due to supply and demand dynamics, environmental regulations, geopolitical events, and sensitivity to extreme weather events fuelled in part by climate change. IDC believes the trends that have caused electricity prices to increase over the last five years are likely to continue.”
“Rising consumption and increased energy costs will make data centres considerably more expensive to operate, but how much is uncertain.”
The company says that all alternative forecasts show percentage growth in electricity spend exceeding a CAGR of 15% with most scenarios showing growth of over 20%.
The study also shows that an additional 10% in energy efficiency can offer considerable savings to data centre operators.
“There are any number of options to increase data centre efficiency, ranging from technological solutions like improved chip efficiency and liquid cooling to rethinking data centre design and power distribution methods,” says Sean Graham, research director at IDC.
“But providing energy-efficient solutions is only part of the equation for meeting customer needs. Data centre providers, including cloud and colocation services, should continue to prioritise investment in renewable energy sources. By investing in renewables, they are helping to increase overall supply while helping their customers meet their sustainability goals.”
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