Artificial Intelligence (AI) Loves Coal
When I first heard about artificial intelligence, I got excited, imaging it to be a pill I could take to boost my rather modest allocation of natural intelligence. Disappointingly AI is not an ingestible but a whole lot of Commodore 64’s (or even moderner models) hooked up and teaching each other how to do the crossword or 3 D print a kidney and other useful applications. All laudable, however, incredibly energy intensive, in fact if you combine that with Bitcoining, estimates are that 2- 4 % of electrical consumption is used undertaking these activities. The US Department of Energy estimates this will double by 2030.
The WSJ (article below) reported that at CERAWeek in Houston this month some stark forecasts were made about the growth in energy consumption. For example, Former U.S. Energy Secretary Ernest Moniz said “Utilities will have to lean more heavily on natural gas, coal and nuclear plants, and perhaps support the construction of new gas plants to help meet spikes in demand…..We’re not going to build 100 gigawatts of new renewables in a few years. You’re kind of stuck”.
Bill Vass, vice president of engineering at Amazon Web Services, said the world adds a new data centre every three days. This has led to the five-year projection of U.S. electricity demand growth doubling from a year ago, according to a report from consulting firm Grid Strategies.
Southern Company, a utility company serving customers in Georgia, Mississippi and Alabama, last year made a significant revision to its power-demand forecast in Georgia, largely driven by the build-out of data centres and other industrial activity.
The company now expects 6,600 megawatts of demand growth through the winter of 2030, 17 times greater than the previous forecast. Globally, the International Energy Agency estimates that electricity consumption from data centres, AI and cryptocurrency could double by 2026.
Whilst we may be reaching the end point of Moore’s law my limited experience with technology is that it never reverts - only builds on itself. When analysts were forecasting thermal coal consumption 3, 4 or 5 years ago, America’s electricity demand was going to be steady, now it’s growing like a developing nation. Since the year 2000, US thermal coal consumption has halved and it appeared that trend would be ongoing until this relatively unheralded demand source appeared.
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