Datacenters Could Account For A Third Of Ireland's Electricity By 2026

Global electricity demand from datacenters could double by 2026, with IT infrastructure adding the equivalent power requirements of another Sweden or Germany. However, low-emission sources are expected to account for almost half of the world's electricity generation by the same time.

These predictions come from the International Energy Agency (IEA) in its latest report analyzing policy trends and market developments in order to estimate electricity demand, supply and carbon dioxide emissions through the four-year forecast period.

One prediction is that demand from datacenters could double. The IEA said it calculated that a combination of bit barns, cryptocurrencies, and artificial intelligence already consumed about 460 Terawatt hours (TWh) of electricity worldwide during 2022, about two percent of total electricity demand, and this is projected to grow.

According to its sums, the IEA thinks that the global electricity consumption from datacenters will range between 620-1,050 TWh in 2026, with the base level of demand at just over 800 TWh. This corresponds to an additional 160 TWh to 590 TWh of electricity needed by 2026, the equivalent of adding at least one Sweden or at most one Germany to overall demand.

Those calculations include the estimated consumption from traditional datacenters, dedicated bit barns for AI, plus cryptocurrency consumption, but exclude power demand from data transmission networks.

Breaking it down regionally, the IEA report says that about 33 percent of the more than 8,000 data dormitories in the world are currently in the US, with another 16 percent in Europe and about 10 percent in China.

Energy consumption in US bit barns is predicted to grow at a rapid pace in the coming years, driven by takeup of 5G networks and cloud-based services, the report says. Demand will grow from around 200 TWh in 2022 to almost 260 TWh in 2026, or about six percent of total electricity.

The US will be outdone by China, which is likely to see datacenter electricity demand double to 400 TWh by 2030, reaching 300 TWh by 2026.

In Europe, datacenter electricity consumption was estimated by the IEA at just below 100 TWh in 2022, with many of those bit barns concentrated in Frankfurt, London, Amsterdam, Paris, and Dublin. Demand for power here will reach almost 150 TWh by 2026.

Perhaps the starkest example is Ireland, where the IEA estimated that 5.3 TWh, or 17 percent of the country's total electricity, was accounted for by datacenters in 2022. If unchecked, bit barns are set to be using 32 percent of the country's total electricity by 2026.

The IEA blames trends such as AI and cryptocurrencies for inflating demand for electricity. It claims that Google Search could see a tenfold increase in its electricity demand if it fully implemented AI in all searches, and require almost 10 TWh of additional electricity in a year.

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Cryptocurrencies used up about 110 TWh of electricity in 2022, according to the IEA, as much as the Netherlands. It forecasts that demand from running cryptocurrencies will increase by more than 40 percent by 2026, to around 160 TWh.

On the plus side, the IEA believes that "clean" energy will be able to deliver all the additional demand between now and 2026. It claims that renewables could generate more than a third of the world’s electricity in 2025, overtaking coal as the largest source, while low-carbon sources, which groups renewables and nuclear together, are expected to account for 46 percent or almost half of the world electricity supply by the end of 2026.

Carbon dioxide emissions from the electricity sector are also on the decline, according to the IEA. It estimates a 2.4 percent fall in global electricity sector emissions in 2024, followed by further declines of 0.5 percent in 2025 and 2026. This is being led by developments such as coal use in China entering a "slow but structural decline" due to a significant growth in renewables.

"The power sector currently produces more CO₂ emissions than any other in the world economy, so it’s encouraging that the rapid growth of renewables and a steady expansion of nuclear power are together on course to match all the increase in global electricity demand over the next three years," IEA executive director Fatih Birol said in a statement.

Birol said that while more progress is needed on decarbonization, and fast, these trends are nevertheless very promising. ®