A new analysis on the rapid proliferation of data centers indicates that the sudden demand for electricity could drive up energy costs for everyone and harm the environment.
The study, published Wednesday morning by the Union of Concerned Scientists, says building data centers faster than utilities can supply electricity will lead to higher costs for everyone.
“They’re increasing the demand faster than you can increase the supply. How’re you going to do that?” said Mike Jacobs, a senior manager of energy for the organization.
The report, “Data Center Power Play,” models several electricity demand scenarios over the next quarter century, along with different energy policy approaches for meeting those demands.
The point is to estimate trillions of dollars in potential electricity, climate and health costs.
“With clean energy policies, we can do this cheaper with less air pollution, less health impacts, less health costs, than doing this business as usual,” Jacobs said.
He added that it takes much longer to build out an electrical grid to accommodate the demand for power than it does to build a data center.
“This is a collision between the people whose philosophy is ‘move fast and break things,’ with the utility industry that has nobody that says move fast and break things,” Jacobs said, in reference to data centers owners’ rapid construction of the facilities.
Future data center demand is hard to predict, thanks in part to limited disclosure from utilities and major tech companies, according to the report. How that demand is met will be critical for both public health and the climate, Jacobs said.
“This is really a great moment for regulators to do what’s within their authority and sort out and assign the costs to those who cause them, which is an essential principle of utility ratemaking,” he said.
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