NEWS UPDATE AI AND DATA CENTRES


Artificial intelligence meets natural stupidity


New research synthesised by a prominent energy expert, Amory Lovins, explains how uncertainties in AI’s energy needs are risking major speculative losses and energy-market distortions.


US electricity use fell in 2023, and in 2024 it rose only 2%. Forecasts of future electricity use have risen lately, especially in a few hotspots that promote and subsidise new data centres. Yet that’s far from a broad trend, and most of the forecast growth is for other or reshored industries, electric vehicles, and electrifying buildings and factories. Data centres used only about 4.5%


of US electricity in 2024. Of global electricity growth, the International Energy Agency (IEA) says only 5% in 2024 was for new data centres, rising to 5 -10% of growth in 2025–30. Both nationally and globally, most data centres aren’t even made or run for AI; they’re for traditional functions like search engines, e-mail, and e-commerce. Big Tech firms are indeed investing at least a trillion dollars in new AI data centres. Hundreds are planned, some as power-hungry as a small city. However, only a small fraction of those proposed are likely to be built, and not all those built are certain to thrive.


Looking ahead Overforecasting seems endemic, severe, and underrecognised. It is caused by peculiarities of the current data-centre marketplace. But underlying those are many fundamental unknowables – even about the dominant model’s basic validity. These make future demand for AI services extremely uncertain. Industry leaders and analysts warn of a potential financial bubble. Moreover, the electricity needed


to produce a given amount of AI service is durably falling by about fourfold every year. That’s faster than purchases of AI services (costly to produce, but now often given free as bait) seem set to keep growing, yielding the revenue to buy the electricity. Assuming explosive growth in power for AI thus looks like a double bubble that can cause toil and trouble for utility investors and for other electricity customers. Two precedents counsel caution: widely believed 1999 coal-industry claims that information technology would use half of US electricity by 2020 proved about 2,400% too high.


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existing gas plants. “Both time- and location-based adaptability offer promising pathways to transform data centres from electricity liabilities into grid and regional assets,” argues Lovins. “By aligning computer demand with cleaner energy availability – whether by time-shifting workloads or siting them in regions with surplus renewables – data centres can support grid resilience, reduce carbon intensity, save infrastructure, and cut costs, if not distorted by short-term economic incentives such as local tax breaks.”


Amory Lovins Physicist Amory Lovins is a globally recognised expert on energy productivity, renewable energy, and sustainable design, dubbed “the Einstein of energy efficiency” by Bloomberg New Energy Finance founder Michael Liebreich. Lovins has authored 32 books and over 900 papers, designed many ultra-efficient buildings, vehicles, and factories, and advised governments and businesses (including more than 100 electric utilities) in over 70 countries. His current work focuses on accelerating the business-led, market-driven global adoption of integrative design and clean energy solutions, affordably scaling breakthrough benefits in security, health, prosperity, development, and competitive advantage.


And in 2010 -18, the world’s data centres did 550% more computing with 6% more electricity. Lovins offers important new


precautions and solutions. Even ambitious forecasts of AI’s electricity needs could be met by any of three proven methods: running data centres more flexibly on rare occasions without materially compromising service; freeing up supplies that are now largely wasted by other customers; and siting new data centres and clean energy (solar, wind, storage) together near little-used


Cleaner energy The IEA expects renewables to add up to 20-fold more electricity supply than data centres raise demand. Renewables and storage are already 93% of US and 95% of world electric capacity expected to be added this year. These cheapest and fastest options can come online sooner than a data centre, while fossil and nuclear plants, both favoured by Trump, would be far slower and costlier. Global nuclear power in a good year adds only as much net capacity as renewables add every two days. “Renewables’ high speed and low


cost have run off with the world power market,” adds Lovins. “For anyone who reads the data and respects the market, it’s game over. Nuclear energy is a parasite on AI’s credibility. Pairing them makes them both less investable.” Buying slower, costlier power by misunderstanding AI and grids risks higher retail rates and painful investor losses – as occurred when hundreds of unneeded power plants were built in a similar panic a quarter-century ago (part of the dot-com bubble’s $5-trillion losses). Utility regulators should protect the public from these speculative risks by requiring data-centre developers to post a bond or insurance policy guaranteeing full payment for their future power needs. Then the parties seeking profits will bear the independently priced risks that their projects create. Responsible AI use may also reduce the risk of oil and gas production emitting more carbon than AI saves.


Appointments


● Optimal Monitoring has appointed Duncan Everett as chief executive officer to lead its global growth strategy. A 16-year veteran of the business, Everett steps up from his role as managing director following a period of sustained growth and rising demand for the company’s AI-driven energy management solutions.


● Vince Arnold has been appointed president of CIBSE for 2025–2026, succeeding Fiona Cousins. With over 40 years’ experience in building services engineering, Arnold brings a strong track record of industry service and professional development. His presidential theme, Paying it forward, highlights his commitment to mentoring the next generation of engineers.


● Global leader in energy solutions Aggreko has strengthened its industrial HVAC and process temperature specialist support with the appointment of Chris Smith as head of temperature control for the UK and Ireland. Chris brings over 22 years of experience at Aggreko and will lead the company’s support for industrial HVAC contractors, engineers and facilities management companies.


● Equity Energies, part of DCC plc, has appointed Maureen Bray as managing director. Bray has over 15 years of experience in energy and sustainability consultancy, having held senior roles at 3Degrees and Schneider Electric, focusing on climate governance, strategy, and project delivery across global markets.


● Bill Sinclair, technical director at Adveco, has been elected chair of the Industrial and Commercial Heating Equipment Association’s Commercial Heating Technical Committee. The committee focuses on technical standards, appliance production, and legislation impacting commercial heating, while advising on industry best practices and supporting the UK’s drive toward decarbonisation.


● The British Compressed Air Society has appointed Dr Steve Downham as its second technical officer. He will work alongside technical officer Tim Preece to support members with technical guidance, standards and training development, with a particular focus on vacuum technologies and diversification beyond compressed air applications.


EIBI | JULY / AUGUST 2025


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