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Electricity demand from artificial intelligence data centers is slowing the planned retirement of America’s coal power plants. The Wall Street Journal’s Ashley Cai reports:
Coal is the electricity sector’s largest and dirtiest source of emissions. As of 2023, the U.S. was expected to take offline 133,000 megawatts of coal power by 2035, or about 70% of its remaining coal capacity.
By 2024, that projection had fallen to 105,000 megawatts, a decline of about 21%.
After 15 years of relatively flat power demand, projections of electricity use are surging. Companies are extending aging fossil-fuel plants to accommodate the expected hike in demand, which is undermining U.S. goals to cut carbon emissions.
Most power companies raised their demand forecast in 2023, and some have indicated higher revisions are expected.
Artificial-intelligence data centers, manufacturing, and broader electrification are the primary drivers behind this projected increase, with data centers accounting for 30% of the expected growth, according to a Goldman Sachs report in April.
Energy companies have long been expecting a rise in demand from the electrification of the U.S. economy, but they have been caught off guard by the demand surge from the sudden rise of AI, said Michelle Solomon, a senior policy analyst at Energy Innovation. “Utilities around the country are kind of going into panic mode,” she said.
Coal power has declined over the past 20 years as it has struggled to compete with cheaper natural gas and renewable projects. Natural gas, which has been replacing coal’s waning capacity, has also been slated to steadily retire to meet climate goals.
Climbing electricity demand, however, is granting coal and natural gas a temporary new lease on life.
Read more here.
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