AI Data Centers: Making Waves in the Energy Demand Sea

The BNEF podcast "Switched On" features Ian Berryman, Head of Energy Systems Modeling at BNEF, discussing the New Energy Outlook (NEO) 2025, with a focus on the impact of data centers and AI on the energy transition. NEO is BNEF's flagship publication, offering a view on the future of energy based on economic and technological factors, excluding policy influences. Berryman highlights that while data center energy demand is growing, it currently represents a small fraction of global power demand. The analysis indicates that a significant portion of the additional demand from data centers may initially be met by fossil fuels, not because data centers are directly powered by them, but because the rate of renewable energy build-out may not keep pace with this new demand. The podcast also explores the geographic distribution of data centers and the potential for on-site generation.