We’re in the age of electricity
Energy demand in general is going up around the world as populations increase and economies grow. But electricity is the star of the show, with demand projected to grow by 40% in the next 10 years.
China has accounted for the bulk of electricity growth for the past 10 years, and that’s going to continue. But emerging economies outside China will be a much bigger piece of the pie going forward. And while advanced economies, including the US and Europe, have seen flat demand in the past decade, the rise of AI and data centers will cause demand to climb there as well.
Air-conditioning is a major source of rising demand. Growing economies will give more people access to air-conditioning; income-driven AC growth will add about 330 gigawatts to global peak demand by 2035. Rising temperatures will tack on another 170 GW in that time. Together, that’s an increase of over 10% from 2024 levels.
AI is a local story
This year, AI has been the story that none of us can get away from. One number that jumped out at me from this report: In 2025, investment in data centers is expected to top $580 billion. That’s more than the $540 billion spent on the global oil supply.
It’s no wonder, then, that the energy demands of AI are in the spotlight. One key takeaway is that these demands are vastly different in different parts of the world.