Decoding datacentre energy demand
Datacentres will guzzle power at a ferocious rate, but the impact on wider energy markets will be far more complex than previously thought
Investment in datacentres to support the AI revolution is growing at an astonishing rate. The largest technology companies spent more than $400b in 2025, and this is expected to rise by another 75% in 2026, according to the IEA. Electricity consumption from AI-focused datacentres grew by 50% in 2025. This unprecedented growth strongly implies a corresponding surge in energy demand and prices as datacentres draw greater and greater volumes of power from grids that are already under strain as the electrification of advanced economies gathers pace. Or does it? The correlation between new datacentres and energy demand and prices may not be nearly as close as initially expected, according to rece
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