The rising popularity of AI is driving an increase in electricity demand so significant it has the potential to reshape our grid. Energy consumption by data centers has gone up by 80% from 2020 to 2025 and is likely to keep growing. Electricity prices are already rising, especially in places where data centers are most concentrated.
Yet many people, especially in Big Tech, argue that AI will be, on balance, a positive force for the grid. They claim that the technology could help get more clean power online faster, run our power system more efficiently, and predict and prevent failures that cause blackouts.
This story is a part of MIT Technology Review’s series “Power Hungry: AI and our energy future,” on the energy demands and carbon costs of the artificial-intelligence revolution.
There are early examples where AI is helping already, including AI tools that utilities are using to help forecast supply and demand. The question is whether these big promises will be realized fast enough to outweigh the negative effects of AI on local grids and communities.
A delicate balance
One area where AI is already being used for the grid is in forecasting, says Utkarsha Agwan, a member of the nonprofit group Climate Change AI.
Running the grid is a balancing act: Operators have to understand how much electricity demand there is and turn on the right combination of power plants to meet it. They optimize for economics along the way, choosing the sources that will keep prices lowest for the whole system.
That makes it necessary to look ahead hours and in some cases days. Operators consider factors such as historical data (holidays often see higher demand) and the weather (a hot day means more air conditioners sucking up power). These predictions also consider what level of supply is expected from intermittent sources like solar panels.
There’s little risk in using AI tools in forecasting; it’s often not as time sensitive as other applications, which can require reactions within seconds or even milliseconds. A grid operator might use a forecast to determine which plants will need to turn on. Other groups might run their own forecasts as well, using AI tools to decide how to staff a plant, for example. The tools also can’t physically control anything. Rather, they can be used alongside more conventional methods to provide more data.
Today, grid operators make a lot of approximations to model the grid, because the system is so incredibly complex that it’s impossible to truly know what’s going on in every place at every time. Not only are there a whole host of power plants and consumers to think about, but there are considerations like making sure power lines don’t get overloaded.
Working with those estimates can lead to some inefficiencies, says Kyri Baker, a professor at the University of Colorado Boulder. Operators tend to generate a bit more electricity than the system uses, for example. Using AI to create a better model could reduce some of those losses and allow operators to make decisions about how to control infrastructure in real time to reach a closer match of supply and demand.
She gives the example of a trip to the airport. Imagine there’s a route you know will get you there in about 45 minutes. There might be another, more complicated route that could save you some time in ideal conditions—but you’re not sure whether it’s better on any particular day. What the grid does now is the equivalent of taking the reliable route.
“So that’s the gap that AI can help close. We can solve this more complex problem, fast enough and reliably enough that we can possibly use it and shave off emissions,” Baker says.
In theory, AI could be used to operate the grid entirely without human intervention. But that work is largely still in the research phase. Grid operators are running some of the most critical infrastructure in this country, and the industry is hesitant to mess with something that’s already working, Baker says. If this sort of technology is ever used in grid operations, there will still be humans in the loop to help make decisions, at least when it’s first deployed.
Planning ahead
Another fertile area for AI is planning future updates to the grid. Building a power plant can take a very long time—the typical time from an initial request to commercial operation in the US is roughly four years. One reason for the lengthy wait is that new power plants have to demonstrate how they might affect the rest of the grid before they can connect.
An interconnection study examines whether adding a new power plant of a particular type in a particular place would require upgrades to the grid to prevent problems. After regulators and utilities determine what upgrades might be needed, they estimate the cost, and the energy developer generally foots the bill.
Today, those studies can take months. They involve trying to understand an incredibly complicated system, and because they rely on estimates of other existing and proposed power plants, only a few can happen in an area at any given time. This has helped create the years-long interconnection queue, a long line of plants waiting for their turn to hook up to the grid in markets like the US and Europe. The vast majority of projects in the queue today are renewables, which means there’s clean power just waiting to come online.
AI could help speed this process, producing these reports more quickly. The Midcontinent Independent System Operator, a grid operator that covers 15 states in the central US, is currently working with a company called Pearl Street to help automate these reports.
AI won’t be a cure-all for grid planning; there are other steps to clearing the interconnection queue, including securing the necessary permits. But the technology could help move things along. “The sooner we can speed up interconnection, the better off we’ll be,” says Rob Gramlich, president of Grid Strategies, a consultancy specializing in transmission and power markets.
There’s a growing list of other potential uses for AI on the grid and in electricity generation. The technology could monitor and plan ahead for failures in equipment ranging from power lines to gear boxes. Computer vision could help detect everything from wildfires to faulty lines. AI could also help balance supply and demand in virtual power plants, systems of distributed resources like EV chargers or smart water heaters.
While there are early examples of research and pilot programs for AI from grid planning to operation, some experts are skeptical that the technology will deliver at the level some are hoping for. “It’s not that AI has not had some kind of transformation on power systems,” Climate Change AI’s Agwan says. “It’s that the promise has always been bigger, and the hope has always been bigger.”
Some places are already seeing higher electricity prices because of power needs from data centers. The situation is likely to get worse. Electricity demand from data centers is set to double by the end of the decade, reaching 945 terawatt-hours, roughly the annual demand from the entire country of Japan.
The infrastructure growth needed to support AI load growth has outpaced the promises of the technology, “by quite a bit,” says Panayiotis Moutis, an assistant professor of electrical engineering at the City College of New York. Higher bills caused by the increasing energy needs of AI aren’t justified by existing ways of using the technology for the grid, he says.
“At the moment, I am very hesitant to lean on the side of AI being a silver bullet,” Moutis says.
Correction: This story has been updated to correct Moutis’s affiliation.
