A fresh International Energy Agency assessment shows a seismic shift in global capital: this year, investment in data centres is forecast at $580 billion, ahead of the roughly $540 billion planned for new oil reserves. The report stresses how digital infrastructure has become a key economic driver.
Electricity demand from AI-focused data facilities is expected to quintuple by the end of the decade, effectively doubling the total energy used by all data centres today. Traditional centres will rise in electricity use, but more gradually.
About half the growth in demand is projected to come from the United States, with the rest spread across Europe and China. Most new centres are being built in large urban areas, with roughly half exceeding 200 megawatts in capacity and many located near existing data‑centre clusters.
The rapid expansion brings challenges. Grid congestion and long interconnection queues are increasing in many regions, with some markets facing waits of up to ten years. Dublin has halted new interconnection requests until 2028.
Supply-chain bottlenecks for cables, minerals, and transformers further constrain upgrades. Nonetheless, innovations like solid‑state transformers are advancing, though initial deployments are 1–2 years away and mass production will take longer.
Renewables are expected to power the majority of new data‑centre electricity by 2035, with solar becoming particularly popular among developers. Looking ahead, around 400 terawatt‑hours of data‑centre power could come from renewables, 220 from natural gas, and up to 190 from small modular nuclear reactors if they materialise.