Tech Talk | ‘No AI without energy’

AI and its links with energy, and specifically electricity, is in the spotlight again in the follow-up to the IEA’s first global round table.

2024 is very much the year of AI in the energy sector and will continue trending into 2025 and likely beyond.

But AI, and its spin-off generative AI, is proving something of a double-edged sword in the sector. On the one hand, it is finding increasing application in areas such as planning and managing the energy system. On the other hand, it is raising increasing concern over its energy consumption with the scale of the data centres required.

Against this background and that the AI revolution is still at an early stage with uncertainty about how it will unfold, the IEA gathered some 500 people to delve into the topic in depth, including a round table and technical forum.

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“There is no AI without energy – specifically electricity,” commented IEA Executive Director Fatih Birol.

“Understanding the AI revolution is critical to understanding the future of energy.”

AI challenges

Among the outcomes reported, participants highlighted the many challenges faced by the energy sector, from persistent concerns about energy security and affordability to lagging progress towards energy access goals, still rising greenhouse gas emissions and the insufficient pace of clean energy innovation.

However, they recognised that AI could accelerate solutions in the sector, provided its potential is better understood and mapped, the necessary enabling conditions are identified, that its environmental footprint does not negate its positive impacts, that countries prioritise research and development to spur innovation in this area, and that policies and deployment models are designed with a view towards addressing these challenges.

They highlighted the significant potential for AI to accelerate innovation, notably for clean technologies, with promising examples cited including AI-enabled innovations in battery technology and materials science.

They also addressed numerous beneficial ways that AI is already being deployed in the energy sector, from forecasting electricity demand and renewables to managing power flows on electricity networks, activating and managing automated demand response and improving the safety and productivity of energy supply.

However, they were also reported to return repeatedly to the importance of an inclusive deployment of AI in the sector that avoids exacerbating today’s existing digital divides and safeguards the interests of consumers.

Data centres for AI

On the topic of energy for AI, participants are reported to have highlighted that while data centres make up only a small share of global electricity demand, around 1%, the demand is likely to rise substantially.

Moreover, the spatial concentration of data centres, already of concern in countries such as Ireland, is out of step with the deployment timelines for energy infrastructure indicating the need for streamlined planning and speedy permitting.

Nevertheless, there is a need to improve understanding of the energy footprint of data centres, towards which the IEA intends to establish an observatory on AI and data centres.

It also is important to meet data centre electricity demand sustainably.

Principles for energy and AI

In his closing, Birol presented six principles for energy and AI:

• The energy sector needs to rapidly deliver sustainable energy for AI, data centres and digital infrastructure and data centres and AI should contribute to secure transitions in the sector.
• AI deployment in the sector should contribute to enhancing energy security, including through cybersecurity and by potentially improving grid flexibility.
• Greater transparency is needed through trusted sharing of data to facilitate informed decision-making and planning. This includes key metrics on data centre capacity, electricity consumption, etc.
• Inclusive and consumer-centric approaches are needed to deploying AI in the sector, in ways that don’t exacerbate existing digital and energy access divides.
• Enabling and supportive policies and business models are important to ensure that the adoption of AI delivers secure, affordable and inclusive energy transitions, including by accelerating clean energy innovation and deployment and optimising the performance of today’s energy system.
• Continued dialogue is needed between policy makers, the energy industry, the tech sector, financial institutions and academia and civil society, with international fora such as the IEA playing an important role.

As part of its ongoing activities, the IEA will deliver a special report on energy and AI targeted for publication in the spring of 2025.

The IEA also is set to work with Canada to develop an approach to AI and energy issues, which would be formalised in 2025 under the country’s G7 Presidency, while other work programmes on AI have been committed to take place with France and Korea.

Jonathan Spencer Jones

Specialist writer
Smart Energy International

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