FEATURE : ENERGY
The total demand for ICT power is projected to grow at a 25 % compound annual growth rate , CAGR through 2030 , while global power generation will only increase at a 3 % CAGR . This means that while total ICT power demand accounts for less than 3 % of the total power generation in 2024 , it will account for over 9 % by 3030 .
In 2021 , the additional demand for ICT accounted for a manageable 4 % of the additional generation capacity globally . By 2023 , driven by the increase in hyperscale data centres , incremental ICT demand was 20 % of total new generation , and this is projected to exceed 70 % by 2030 .
While these numbers may seem alarming on a global basis , they can be amplified in regions that have a large concentration of data centres .
Demand and supply imbalance
The result is that if current trends in data centre construction continue , a shortage in available power from traditional grid suppliers will rapidly develop . While this shortage will become acute by the end of the decade , regional shortfalls are likely to occur on a significant level within a couple of years .
In past years , ICT power consumption could grow much faster than electricity supply because it was a relatively small portion of the total . However , as ICT exceeds 5 % of the total supply , it becomes a significant factor in electricity consumption . ICT will begin to compete with other major users like residential power , about 40 %, commercial power , about 35 % or industrial power , about 25 % for access to power generation capacity .
The inevitable result of the impending electricity supply-demand imbalance is that , as demand for electricity begins to outstrip supply , electricity will get more expensive . Consequently , marginal applications will drop out of the market , and only those that can afford higher-priced electricity will remain .
In addition , as power scarcities begin to become apparent , regional planning authorities will limit approvals for new data centres and other ICT infrastructure that would strain existing power grids . The result is that data compute , storage and communication capacity becomes supply-constrained and , therefore , expensive .
However , an added complication is that , if electricity gets too expensive for average consumers , politicians may force the allocation of electricity to consumer applications like powering the home and
Medium to long term plans for data centre administrators supporting Generative AI workloads
• Evaluate the impact of potential power shortages on products and services by developing scenarios that reflect limitations on available power .
• Include significant cost increases for data centre services when developing plans for new products and services .
• Look for alternative approaches that require less power while achieving the same market impact .
• Reevaluate sustainability goals for CO 2 production in light of anticipated increases in the use of fossil-fuel-based power generation .
• Determine the risks and impact potential power shortages will have on all products and services , current and planned , by evaluating the likelihood that they will require new data centre construction to be successful .
• Develop workaround solutions for power shortages , outages by identifying major risk points and potential alternatives .
• Diversify to geographic regions with sufficient power to ensure that products and services will not be affected by power shortages .
• Negotiate long-term contracts for data centre services at reasonable rates for power .
• Conduct a cost-benefit analysis of planned expansions of products and services in light of projected data centre costs .
• Consider moving some products and services to regional data centres in areas with more predictable power costs .
• Reevaluate sustainability goals relating to CO 2 emissions in light of future data centre requirements .
• Work with data centre providers and power utilities to evaluate the emissions potential for data centre alternatives .
• Develop Generative AI applications with a focus on using a minimum amount of computing power .
• Look at the power , and emissions implications of options such as edge computing and smaller language models .
• Support initiatives to promote development and implementation of green power alternatives such as nuclear , green hydrogen , fusion , geothermal .
• Reevaluate sustainability goals relating to CO 2 emissions in light of future data centre requirements and data centre power sources .
transportation . This forced allocation will reduce the amount of electricity available to other applications , like ICT .
The impact of impending power scarcities will be greater in areas with large concentrations of data centres . In some areas , wholesale power prices – the price for power direct from the generating plant into the distribution grid – are already reacting to potential shortages .
Major users of power are working with major power producers to secure long-term guaranteed sources of power independent of other
Bob Johnson , VP Analyst , Gartner
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