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Big Tech’s electricity usage must be curtailed by the government to maintain a stable supply, as it trains artificial intelligence.
Hitachi Energy CEO Andreas Sierenbeck told the Financial Times in an interview that other industries are not allowed to use electricity as much as the AI ​​sector.
Along with a massive surge in electricity demand in data center training AI models and the bumpy renewable energy supply, “volatility of volatility” meant it was making it difficult to maintain the lights, he said.
“AI data centers are very different from these office data centers. “When you start an AI algorithm and provide the data to learn and digest the data, they peak in a few seconds, going up to ten times what you normally use.”
“Users from an industry perspective are not allowed to take this kind of behavior. If you want to start a smelter, you need to call the utility upfront,” he added.
While much of the concerns about AI data centers are concentrated on the enormous amount of electricity they consume, Schierenbeck, who previously ran German energy group Uniper, is one of the first to raise alarms on the large peaks and troughs that are in demand caused by AI algorithms.
The International Energy Agency predicts that data centers’ electricity consumption will double by 945 terawatts by 2030. Ireland and the Netherlands have already restricted the development of new data centers due to concerns about the impact on power networks.
Analysts at Rystad Energy, an Oslo-based consultant, argue that the power demand for AI will help stabilize the grid as long as it sets maximum power limits for AI models processing and scheduling training when renewable energy is abundant.
Hitachi Energy, formed in 2020 of the $11 billion acquisition of ABB Power Grid, is at the heart of the global shortage of power transformers, a key grid component that helps regulate electricity.
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Schierenbeck estimated the shortage would easily take up to three years, saying the Japanese company is focusing on reducing backlogs worth $43 billion from $14 billion a year ago.
He said there is a shortage of professional contractors capable of building the reinforcement floors needed to manufacture transformers weighing hundreds of tons. This was a limiting factor in factory expansion, which allowed the industry to keep up with demand more quickly.
Hitachi Energy will invest $6 billion to boost production capacity and employ 15,000 workers by 2027 to meet orders from utility and grid infrastructure providers.
Schierenbeck predicts he has little trouble filling roles, especially in Europe, where engineers are fired from the automotive and chemical sectors.
