Data centres powering artificial intelligence systems could push electricity demand to unprecedented levels. According to the International Energy Agency (IEA), AI may consume as much electricity by 2030 as Japan does today. Although the agency rejects the idea of a looming climate crisis, critics call this view “dangerously optimistic.”
A Tsunami of Power Demand
The IEA reports that global data centre electricity consumption is on track to more than double by the end of the decade, led by a fourfold increase in AI-specific energy use.
Electricity used for AI data processing is expected to exceed that used by all traditional energy-heavy industries combined in the U.S. A single data centre can use as much electricity as 100,000 homes today. New facilities could consume 20 times more, straining power grids.
Renewables Falling Short
The IEA warns that by 2030, only about half of the electricity needed for AI systems will be sourced from renewables. Existing power grids, originally designed for centralised fossil fuel generation, are not fully equipped to handle the intermittency of wind and solar power.
Some countries may turn back to fossil fuels with demand rising faster than clean energy supply. In the U.S., the possibility is intensified by shifting political leadership, including former President Donald Trump’s support for coal. The IEA report states:
“The rapid increase in AI also means companies will seek the most readily available energy – which could come from gas plants… In the US, the demand could even be met by coal-fired power stations being given a new lease on life, aided by Donald Trump’s enthusiasm for them.”
Efficiency Potential vs. Climate Risk
The IEA sees room for optimism, stating that AI, if used strategically, could help balance its own energy impact. Possible applications include improving grid management, cutting waste in industry, and streamlining public transport.
“With the rise of AI, the energy sector is at the forefront of one of the most important technological revolutions of our time,” said Fatih Birol, the agency’s executive director. “AI is a tool, potentially an incredibly powerful one, but it is up to us – our societies, governments and companies – how we use it.”
The report highlights how AI could assist in managing renewable inputs and identifying minerals essential for clean energy but the agency’s hopeful message is not shared by all.
Critics Warn of Industry Bias
The IEA’s latest report has drawn criticism from environmentalists and energy experts, who accuse the agency of downplaying the risks posed by AI and large data centres. They argue that the report lacks firm guidance for governments. Claude Turmes, former Green MEP and current energy minister of Luxembourg, said,
“Instead of making practical recommendations to governments on how to regulate and thus minimise the huge negative impact of AI and new mega datacentres on the energy system, the IEA and its [chief] Fatih Birol are making a welcome gift to the new Trump administration and the tech companies which sponsored this new US government.”
Alongside energy use, growing attention is being paid to data centres’ water demands. These facilities often require vast amounts of water for cooling and are increasingly located in regions already facing water stress. A recent investigation found they are “sucking water from some of the world’s driest areas.”
Conclusion
The IEA highlights the importance of policy in determining AI’s environmental impact, stating that outcomes are still within government control. Critics caution that, without regulation, environmental risks could overtake the gains AI might offer. AI remains a double-edged tool — its future effects on the planet will depend more on governance choices than on the technology itself.