Tech
AI, Cryptocurrency Mining Could Be ‘Bad News’ for Data Centers, Here’s Why
Technology companies use data centers to store emails, photos, videos and other data available in the cloud. To train AI models and mine cryptocurrencies like Bitcoin, the number of data centers is growing around the world. Artificial intelligence training and cryptocurrency mining could push data centers to double their electricity consumption by 2026, according to a report from the International Energy Agency (IEA).
Cryptocurrencies and AI tools like ChatGPT have already raised concerns about their impact on the environment. These data centers have been criticized for greenhouse gas emissions caused by their electricity use.
For comparison, in 2022, data centers, cryptocurrencies and artificial intelligence accounted for approximately 2% of global electricity demand, equivalent to 460 TWh of electricity.
The report predicts that data center electricity consumption is expected to increase by up to 1,050 TWh by 2026 depending on the pace of technology development.
Why Data Center Electricity Consumption Could Increase in Several Countries According to the report, the United States has the largest number of data centers in the world. 33% of the estimated 8,000 data centers worldwide are present in the country which is also a leader in Bitcoin mining.
Over the next two years, data center electricity consumption in the United States is expected to increase from nearly 4% of the country’s demand in 2022 to 6% by 2026, the report predicts. The expansion of 5G networks and cloud-based services will also contribute to growth.
Ireland is also expected to see a boom in new data centres. In 2022, 82 data centers already operational accounted for 17% of the country’s electricity consumption. The report predicts another 54 are under construction or recently approved to begin construction. By 2026, these data centers could become cumulatively responsible for nearly a third of the country’s annual electricity demand.
How AI and Cryptocurrencies Can Increase Electricity Consumption In a scenario where Google Search has fully incorporated AI, it could use up to ten times more electricity, the IEA report notes. The report also predicts that the AI industry could use ten times more electricity in 2026 than in 2023.
By 2026, electricity demand for cryptocurrencies is also expected to increase by 40%. However, the Ethereum blockchain has managed to reduce electricity consumption by more than 99% by switching to a more energy-efficient method of validating blocks of new transactions.