Data Center Demand?
Data center demand is projected to double in the U.S. by 2030. To meet this demand proposals for new centers are sprouting up all over the country. Northern Virginia is one of the biggest data center hubs in the U.S. and demand there is expected to double over the next 8 years. Right here in Georgia data center demand is growing. In fact, mostly because of data center demand, the decades long leveling of energy demand has stopped. Data center energy consumption is projected to reach 35 Gigawatts by 2030. That is the equivalent of 35 full scale nuclear power plants output.
Data Center Energy Use?
The average data center uses the equivalent amount of electricity as power for 80,000 homes. 40% of the power is used just to cool the centers computer servers down. The current and projected electricity needs are scuttling most of the hope of reducing the use of fuel sources to produce electricity. Solar panels and battery storage can help, but there is simply not going to be enough to meet demand. A solar panel farm would have to be about 8 square miles to have the capacity of a nuclear plant, and that is just when the sun is out. Batteries can extend and help, but data centers run 24/7.
More Data Centers?
We are and will build more data centers to keep up with demand. That is just the way our system works. The issue is energy demand and space. Space most likely will be solved but energy demand is a thorny issue. The Georgia Public Service Commission just approved Georgia Powers proposal to build natural gas generation in Yates, Georgia. Yates is approximately halfway between Carrolton and Newnan on the Chattahoochee River. Power companies have traditionally used a 2 to 3 % increase in electricity use as a model. Data centers and AI have torpedoed that model.
Your Power Bill ?
All rate payers pay for new power generation. Whether we think this is fair or not, it is the current state of affairs. Last year the average Georgia power bill increased by $15.90 cents per month. This increase was for unrecovered fuel costs and future fuel costs. What is frustrating about this increase is it comes when natural gas prices are historically low. What is going to happen when the natural gas market normalizes? My bet, it will not be good for rate payers.
Back to the 1970’s
We went through terrible double-digit inflation back then and it extended into the 1980’s. The original Plant Vogel had huge cost overruns as well, mostly due to double digit interest rates. Just like back then, we are faced with increased electricity demand and higher costs. Buckle up, the political pressure on the PSC and our state government is just starting to heat up. Like back then, my prediction is, nobody will be happy for at least the foreseeable future.
Thanks, Andy McClung CFP®
GA recorder stanley dunlap ; Datacenter dynamics.com Mathew Gooding; fox 5 atlanta.com
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