You can almost see Big Tech’s energy-hungry appetite from Scotland’s east coast. There is a wind farm about 12 miles offshore, with 60 enormous turbines each possessing blades around the length of an American football field. When finished, the Moray West project’s utility providers said the site could produce enough electricity to power 1.3 million homes. This was before Amazon’s intervention.
As part of its continuous effort to feed its insatiable demand for power, Amazon said in January 2024 that it had reached an agreement to claim more than half of the site’s 880 megawatts of output. The greatest corporations in the world are racing to construct the infrastructure required for artificial intelligence (AI), and even isolated wind farms in Scotland are becoming essential.
In Europe in 2023, $79.4 million was spent on new data centre projects, according to research firm Global Data. There are indications that demand is increasing even in 2024. Microsoft has revealed about betting $3.2 billion on data centres in Sweden. The business also said that it would treble the amount of space it had for data centres in Germany and that it would invest $4.3 billion in AI data centres in France.
As part of an $8.5 billion investment in Germany, Amazon unveiled a network of data centres in Brandenburg state. Later, the company committed an additional $17.1 billion to Spain. To spur the development of AI, Google announced that it would invest $1.1 billion in its Finnish data centre.
There’s a panic behind the scenes about how to fuel the massive data centres that the big companies are racing to create. It is the goal of logistics-heavy Amazon to reach net zero by 2040, while Microsoft, Meta, and Google want to reach net zero by 2030. Over the last ten years, several corporations have acquired contracts for renewable energy from the solar or wind industries to achieve that goal. However, as the need for clean energy rises, power grids, the foundation of all these projects, are breaking. This puts pressure on the big IT companies to plan for their energy-intensive futures and explore ways to run their off-grid power empires independently of the system.
According to Colm Shorten, senior director of data centre strategy at real estate services company JLL, “There is a recognition that the industry will have to find alternative energy sources as power demand increases, while adding that server farms are increasingly searching for “behind-the-wire” power supplies, such as gas/diesel generators, or more cutting-edge technology like green hydrogen.”
In essence, grid operators are saying the same thing. Two years ago, Eirgrid, the state-owned energy provider in Ireland, put an effective ban on data centres located in Dublin, citing grid issues. The Dutch Data Centre Association, a business association, retaliated against the mayor of Amsterdam’s introduction of a similar pause. In a statement, it stated that “the existing grid congestion in North Holland is hindering the growth of the data centre sector.”
Data centres are moving into more noticeable parts of Europe in their quest for grid space, and when they do, they run the danger of encountering resistance from the smaller villages.
According to Simon Hinterholzer, a researcher at the German Borderstep Institute for Innovation and Sustainability, that trend is already evident in Germany.
“Frankfurt used to be the site of most new data centre construction. In the past two or three years, this has entirely changed,” he claimed, while citing the construction of a 300-kilowatt data centre in Wustermark, a small town, and the most recent investment made by Amazon in Brandenburg, a neighbourhood that borders Berlin, and saw the installation of more than 70 turbines in 2023.
The long-term survival of data centres outside the grid is becoming more and more necessary.
“The scope of AI projects is expanding exponentially, with the potential to reach 1 gigawatt of power that is not attainable through traditional power grids,” states Ricardo Abad, the founder of Quark, a data centre that is developing a new location in Spain with an undisclosed partner that will have on-site solar and wind power for self-generation.
Although these kinds of on-site projects can function independently, they are theoretically still linked to the grid in case they wish to export extra electricity.
Amazon unveiled its largest-ever on-site solar farm, covering the roof and parking lot of its fulfilment centre in Seville, Spain, the same year Dublin placed restrictions on data centres. For its upcoming server farms, Google’s head of data centre location strategy in Europe has also shown interest in on-site renewable energy sources. Both Microsoft and Meta denied managing any fully off-grid initiatives. However, Microsoft is constructing a data centre in Dublin in addition to its gas backup plant, so even if the grid operator switches it off, the website will continue to function.
Big Tech is looking for renewable energy ideas. According to Kilian Wagner, a specialist in sustainable digital infrastructures at the German digital association Bitkom, “Technology like enhanced nuclear reactors, renewable energy sources, and energy storage systems will be important in making this possible in the future.”
As an investor in Helion Energy, an American nuclear fusion firm, OpenAI boss Sam Altman has also committed to supply Microsoft with 50 megawatts of electricity from its first operational fusion nuclear plant. Microsoft has been experimenting with hydrogen fuel cells in the United States and is promoting them as an emission-free backup power source.
It’s unclear what the rest of us would lose out on if server farms went off-grid. Big Tech companies may find success going it alone in their quest for the sustainable energy source of the future. The grid is their only option till they figure it out.
AI and its energy thirst
There may be a substantial energy cost associated with using AI for some tasks. Journalist Melissa Heikkilä detailed in an article from December 2023 that some sophisticated AI models can use as much energy to generate an image as it does to charge your phone.
According to the researchers Melissa spoke with, producing 1,000 photos with a device like Stable Diffusion XL produces as much carbon dioxide as driving slightly more than four miles in a gas-powered automobile.
Although created visuals are visually striking, many AI jobs consume less energy. For instance, producing graphics requires thousands of times more energy than producing text. Additionally, it can be dozens of times more economical to use a smaller, task-specific model rather than a large, general-purpose generative model. Either way, we use generative AI models a lot, and they consume energy.
By 2026, data centre, artificial intelligence, and cryptocurrency electricity demand may quadruple from 2022 levels, the International Energy Agency projects. In 2022, those technologies will account for about 2% of the world’s total electricity consumption. Be aware that these figures don’t only apply to AI; it can be challenging to pinpoint AI’s precise impact. With that in mind, keep in mind projections regarding data centre electricity consumption.
The IEA’s forecasts are subject to a wide range of uncertainty, based on factors like the rate at which deployment rises and the efficiency of computational operations. At the low end, the industry might need an extra 160 terawatt-hours of electricity by 2026. That figure could be as high as 590 TWh.
According to the analysis, the combined effects of Bitcoin, data centres, and AI are probably going to increase world electricity demand by “at least one Sweden or at most one Germany.”
The IEA estimates that during that same period, global electricity demand will increase by almost 3,500 TWh. While computing plays a significant role in the shortage of electricity, it is by no means the entire story. The need for power will rise more from the industrial sector and electric vehicles than from data centres in the EU, for example.
However, a few major tech firms are speculating that AI might interfere with their efforts to combat climate change. Microsoft committed to achieving zero or even lower greenhouse gas emissions by the end of the decade four years ago.
However, the company’s most recent sustainability report reveals that emissions are continuing to rise, with some executives blaming artificial intelligence for this. 2020 saw the release of our carbon moonshot. That was before the artificial intelligence explosion, Microsoft President Brad Smith said to Bloomberg Green.