Surging datacenter power demand slows the demise of US coal plants

Ongoing fossil fuel use means maybe it's time to revise that idea that AI will kill us with robots

Coal-generated energy in the US is set to stick around longer than previously expected, to fulfill increasing demand from datacenters.

Energy market analyst firm S&P Global Commodity Insights noted that only 54 gigawatts of the US coal industry is projected to be powered off by 2030 – down 40 percent from a prediction made in July last year. The total number of coal plants retired by 2050 is still expected to be roughly the same, but the pace of retirement from now to the end of the decade will be significantly slower compared to last year's estimates.

Specific examples include Alliant Energy delaying the coal-to-gas conversion of its Wisconsin plant by three years to 2028, and FirstEnergy completely abandoning its plan to quit coal by 2030.

Coal plants can credit their new lease on life to the datacenter industry, which is expanding and upgrading existing bit barns as well as building new facilities. The age of AI requires lots of energy – Google search powered by AI alone is expected to use ten times the power of a more traditional information request, according to the International Energy Agency's (IEA) January report.

Datacenters – especially those with AI hardware and software – are expected to consume a substantial portion of regional and global energy supplies. The most extreme predictions come from the IEA, which claims a third of Irish power could be used on datacenters by 2026, and Arm CEO Rene Haas who has predicted that by 2030 a quarter of the US power grid’s output would be consumed by server farms.

That Other analysts forecast much lower power consumption figures, specifically for the US. Goldman Sachs forecasts [PDF] datacenters will use eight percent of energy by 2030, and a report from the Electric Power Research Institute predicts it will be nine percent in the same timeframe.

Even eight or nine percent would be a substantial increase from today's datacenter power consumption, which Goldman Sachs estimates is around three percent of US energy output.

While the world is making good progress on bringing up fresh sources of green energy, clearly it won't be enough to satisfy demand from datacenters. The demand is so high in Ohio that the local branch of American Electric Power is asking permission to impose tariffs on datacenter customers

The impact of AI apparently isn't recent. Microsoft's carbon emissions increased almost 30 percent from 2020 to the middle of 2023, according to the firm's latest sustainability report.

If sources of green energy continue to be insufficient for datacenters, it seems likely the facilities will either have to halt their expansion or lean more heavily on fossil fuels like coal and natural gas. And none Big Tech is decidedly not currently talking about slowing its rollout of AI infrastructure. ®

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