The AI Boom Is No Friend of the Green Energy Transition

The technology of the future relies on a source of energy deployed by Paleolithic cave dwellers. As juice-sucking tech firms battle for artificial intelligence supremacy, the coal industry has been cleaning up. 

What’s an UNLESS?

So it goes for fossil fuel purveyors. Like Dr. Seuss’ Lorax, Joe Biden has tried to bill himself as one who “speaks for the trees,” targeting a carbon pollution-free energy sector by 2035. However, his presidency has involved some Once-ler flair, too. For the past six years, the US has produced more crude oil than any nation at any time, according to the US Energy Information Administration. Renewable energies like hydro, wind, and solar comprise about 21% of the country’s electricity generation. That’s progress, but it’s roughly a third of the demand covered by fossil fuels.

It’s not just AI firms hogging all the juice. Cloud data processing and quantum computing require plenty of power, and a lot of it comes from dirty sources. Crypto mining accounts for 0.6% to 2.3% of all electricity used in the US and is more likely to keep fossil fuel operations humming than pave the way for renewable energy, one Princeton professor told The New York Times last year. Just look at the top 10 stocks and the top five performers on the S&P 500, and it’s easy to see how big tech firms and energy companies feed off of each other. 

Now, as the AI race ramps up and energy demands rise, coal power operators are delaying plans to shutter certain facilities:

• By the end of the decade, operators plan to cut only 54 gigawatts of US coal power generation assets, a 40% downward revision from last year, the Financial Times reported. Alliant Energy had intended to convert a Wisconsin coal-fired plant to gas next year but just delayed it to 2028. FirstEnergy ditched plans to phase out coal operations by 2030 due to “resource adequacy concerns.”
• This isn’t to say the coal market is growing, but it also won’t be significantly shrinking — though past its glory days, coal still accounts for about 16% of generated electricity. 

The Road Less Traveled: New technologies to help mitigate fossil fuel usage are having a rough go of it, too. Though drivers are switching from combustion engines to their battery-powered counterparts, it hasn’t been a 0 to 60 in 3.5 seconds transition. EVs still make up only 1% of all cars on US roads, meaning it will be quite a while before gas stations are as obsolete as window cranks.