Input Stories

The rapid construction of artificial intelligence data centers is greatly increasing the risk of power outages and electricity disruptions, energy regulators are warning (POLITICO Pro’s ENERGYWIRE, subscription).

What’s going on: “Panelists at a Tuesday conference hosted by the Federal Energy Regulatory Commission emphasized that the large-scale energy consumption of AI data centers presents challenges to supply and demand and to technical engineering requirements. The meeting featured representatives from utilities, grid operators and technology companies.”

• While grid reliability remains high, speakers said, risks “continue to mount,” with a rising number of small-scale outages and “near misses.”

The backdrop: The conference took place as U.S. forecasts for AI-led electricity demand skyrocket.

• Consulting firm ICF International projects a 25% increase by 2030, a rise that would require the U.S. to double its pace of electricity generation building.
• A generative AI query typically uses 10 times the power of a traditional online search.

Next moves: Panelists at the event offered steps that the federal government, regulators, states and utilities can take to prepare for the explosion in data center growth.

• A leader from Texas-based power producer and retailer Vistra Corp. suggested doing what his company is doing: modernizing grid interconnection rules to add capacity more quickly through facility upgrades and conversions.
• And the Georgia Public Service Commission “has revamped its process for developing a utility’s integrated resource plan … to allow faster updates and accelerated permitting.”

A challenge… The increased addition of inverter-based power resources, such as wind and solar, are challenging the grid’s voltage and frequency stability, particularly during extreme weather, North American Electric Reliability Corporation President and CEO Jim Robb said at the event.

… and a question: Will the expected loads from coming data centers manifest as predicted?

• “Panelists expressed varying degrees of confidence in several official and third-party forecasts but agreed that even if large swaths of developments stall, growth will still be significant.”

Our take: “The explosive growth in U.S. energy demand and the subsequent strain on the electric grid shine a spotlight on the need for increased production of and access to all types of energy—as well as serious improvements to our electrical transmission and distribution infrastructure,” said NAM Director of Energy and Resources Policy Michael Davin.

• “Comprehensive permitting reform and boosting investments in strong supply chains will achieve these goals.”