Global AI Boom to Triple EU Data Centre Energy Use by 2030

The rise of artificial intelligence (AI) is causing the data centre industry to experience overwhelming demand. Likewise, swelling growth in global data centre demand has also come with a rise in power demands. 

In order to meet new IT load demands, McKinsey suggests via its latest report that more than US$250-300bn of investment will be needed in data centre infrastructure. The firm suggests that European demand is expected to peak so much that it will more than triple by 2030.

AI has been cited as the critical cause of such a surge, as the technology consumes significant levels of power and energy to run. According to McKinsey’s projections, power demands will rise from the current 62 terawatt-hours (TWh) to more than 150 TWh.

How AI can transform industry outlook

As businesses and organisations increasingly adopt AI-driven solutions, the demand for computing power has skyrocketed, placing unprecedented pressure on data centre infrastructure.

This has meant the total IT load demand for data centres in Europe is projected to grow from 10 gigawatts (GW) in 2023 to approximately 35 GW by 2030, representing a compound annual growth rate (CAGR) of about 20%. Such an expansion means that data centre loads could account for 15-25% of all new net European demand added through to the end of the decade.

Hyperscalers, including major cloud service providers, are at the forefront of this growth, currently driving up to 70% of the anticipated demand by 2028. These tech giants are not only expanding their data centre footprints, but also pushing for more energy-efficient and sustainable operations.

Ensuring European data centre sustainability

Such a demand for power comes with its own set of challenges for the European data centre industry. Limited sources of reliable power, sustainability concerns and insufficient upstream infrastructure for power access are among the primary hurdles facing the industry. 

For instance, in established markets like Dublin and Frankfurt, McKinsey states that the time required to supply power to new data centres can exceed three to five years, with lead times for electrical equipment alone often surpassing three years.

In response, the European Commission has already taken steps to address the environmental impact of data centres with strategies like new regulations to require data centre operators to report on key performance indicators 

The European Commission has already taken steps to address the environmental impact of data centres. New regulations will require data centre operators to report on key performance indicators to the European database starting in 2024, as part of the recast Energy Efficiency Directive.

Companies within the industry have also announced a range of net zero commitments, with McKinsey indicating the shift towards renewable and low-carbon energy sources aligns with the ongoing global energy transition.

As the demand for AI-driven computing continues to grow, the data centre industry faces a critical juncture. McKinsey states that the need for increased power capacity must be balanced with sustainability goals and grid stability concerns - a situation that presents both challenges and opportunities for innovation across power generation, distribution and management.

The report surmises: “Addressing the energy needs of data centres could help to bridge the investment gap that has historically lagged advancements in power generation. Moreover, strengthening the link between generation and distribution grids is crucial to support expanded generation capacity and ensure efficient power delivery. 

“By addressing these challenges proactively and investing in the necessary infrastructure and technologies, Europe could create a more resilient and sustainable energy future.”

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