Climate gains from renewables risk being wiped out by rising AI and data centre demands

Demand for AI and data centres risks wiping out recent climate gains

A new paper published in Nature Reviews Clean Technology has argued that recent climate gains achieved by renewable energy expansion are at risk of being wiped out, as AI and data centre energy demands soar.

Researchers from Sussex and Vienna’s Central European University have found that the rapid expansion of renewable energy is being used to meet rising electricity demand, rather than displacing fossil fuels. They highlight that during the first three quarters of 2025, record growth in solar power helped raise clean electricity generation to outpace global growth in electricity demand for the first time.

It follows research released last month by think tank Ember which found that for the first time, wind and solar generated more electricity than fossil fuels in the EU. The European Electricity Review reported that in 2025 solar and wind combined to produce a record 30% of power, ahead of 29% from fossil fuel sources. Ember’s researchers credited solar energy as being the key driving force leading to the uptick in renewables share of electricity generation within the EU. They found that solar grew by more than a fifth (20.1%) for the fourth year running, generating a record 13% of power in the EU in 2025- ahead of both coal and hydro energy.

However, the gains made by renewables may well soon be undone. The University of Sussex research suggests that this fragile balance is now starting to tip back the other way, with the researchers apportioning blame to new loads such as artificial intelligence data centres and increasing cooling needs due to warmer temperatures, all of which are accelerating an already increasing demand for energy. In addition, electrification of transport and consumer trends such as bigger cars were also highlighted as culprits.

“Renewables are scaling at record speed, but demand growth from data centres, cooling and transport is running just as fast,” said Professor Felix Creutzig, Bennett Institute Chair at the University of Sussex[i],

The researchers stress that achieving a genuine and sustained global-scale energy transition (where renewables structurally displace fossil energy) will require greater emphasis on reducing energy demand while increasing well-being. They warn that this means that without further demand-side efforts, additional power demand between 2025 and 2030 is expected to consume the projected rapid renewable energy expansion.

“We need policies that curb unnecessary energy use and shape demand so that clean electricity can have the intended effect of cutting emissions from fossil fuels.”[ii] Felix Creutzig adds.

Artificial Intelligence set to drive up data centre energy demands

Last year the IEA (International Energy Association) reported that growth in the use of Artificial Intelligence will lead to the global electricity demand from data centres more than doubling in the next 5 years, reaching 945 terawatt-hours (TWh) in 2030. This figure is equivalent to Japan’s annual electricity usage and represents an almost 128% increase from the 415 TWh of power used by data centres in 2024.

"AI will be the most significant driver of this increase, with electricity demand from AI-optimised data centres projected to more than quadruple by 2030,"[iii] the IEA claimed. The researchers credit a step change in the capabilities of artificial intelligence (AI) with soaring demand, explaining that this has been driven by falling computation costs, a surge in data availability, and technical breakthroughs. Further, AI has moved from an academic pursuit to a trillion-dollar industry; the market capitalisation of AI-related firms in the S&P 500 has grown by around $12 trillion since 2022.

In the IEA’s forecasts electricity use by data centres grows from 180 million tonnes (Mt) today to 300 Mt in its ‘Base Case’ by 2035. While these emissions remain below 1.5% of the total energy sector emissions in this period, data centres are among the fastest growing sources of emissions. Further, data centres are among the few sectors – along with road transport and aviation – that see an increase in their direct and indirect emissions to 2030.

A separate long-range forecast from BloombergNEF found that electricity demand of data centres will grow from 4.5% of total global power demand in 2035, to 8.7% in 2050. As such, BNEF estimates that an additional 362 gigawatts of power generation capacity will be needed to meet data centre demand by 2035, attributing the energy demand increase to the global growth in AI[iv].