The conversation around artificial intelligence and energy is becoming more sophisticated as it shifts from an initial focus on US fossil fuel supply as a way to power data centers to the potential to advance energy efficiency — potentially saving more energy than it uses. AI could also facilitate faster electrification of the energy system while easing some of the problems this creates.
Schneider Electric CEO Jean-Pascal Tricoire believes that AI can generate immediate gains of "roughly 20%" in most applications — including "every building, most of the manufacturing and certainly most of the infrastructure in cities" — at a modest energy cost of less than 1% in extra generation to power data centers.
AI will make "smart" buildings truly smart instead of just pretending they are, agreed Holly Paeper, in charge of commercial applications at heating, ventilation and air-conditioning company Trane Technologies, at the recent Climate Week in New York. "AI can sit on top of a building's thermal management and continuously optimize it," she said. "What we're finding is that buildings can save 20%, 30%, 40% in what they're using, it's tremendous."
These savings would feed through into a net positive impact on CO2 emissions. While AI could add around 300 million tons of CO2 emissions through 2035, its use could reduce emissions by five times as much, or 1.5 billion tons over that period, said Bank of America's global head of sustainable and infrastructure finance, Karen Fang. Energy efficiency, which is often overlooked, plays an important role in all long-term climate plans. Primary energy consumption per unit of global GDP falls by 2.2% per year over 2023-50 in the International Energy Agency's (IEA) base Stated Policies Scenario, for example, and by 3.1% per year in its Net-Zero Emissions Scenario, compared with an actual 1.6%/yr over 2010-23.
