Keaton PetersThe U.S. grid is not yet ready for the surge of data centers, a new study suggests. Electricity consumption from data centers is projected to rise from 5% to over 16% of total U.S. electricity use by 2033. A new report from Accenture reveals the massive investment needed to power America’s AI-driven digital transformation, with projections that $58-89 billion in additional capital expenditure will be required for power generation by 2030.
According to Accenture’s research, the data center industry could consume between 413 and 509 terawatt hours (TWh) of electricity by 2030, up from 176 TWh in 2023. This rapid growth is primarily driven by facilities capable of accommodating advanced AI technologies, which may account for about 70% of the overall demand surge.
This significant shift in energy consumption patterns represents one of the most dramatic changes to America’s power landscape since rapid industrialization in the mid-20th century. The surge in data center power requirements comes as artificial intelligence, cloud computing and digital services reshape America’s tech industry. The industry’s expansion could change how America generates its power, how it is distributed and how much it costs to keep the lights on.
Nuclear power, once facing an uncertain future in the United States, is experiencing renewed interest as tech companies seek reliable, carbon-free energy sources. In September, the Department of Energy provided a $1.52 billion loan guarantee to restart the Palisades Nuclear Plant in Michigan, which could become the first recommissioned nuclear plant in U.S. history when it returns to service.
While renewable energy remains a priority for tech giants committed to sustainability goals, the report suggests these sources alone cannot meet the sector’s growing demands. Natural gas is expected to play a significant transitional role, potentially supplying nearly 60% of the incremental power demand for data centers by 2030.
Among the report’s key recommendations are collaborative strategies between utilities and data center operators, including enhanced demand response programs, streamlined grid interconnection processes, and innovative pricing structures. The report also advocates for greater investment in grid modernization and transmission capacity, with projections that capacity must increase by 128% within regions and 412% between regions by 2035.
For state and local governments looking to attract data center investment, the landscape is becoming increasingly competitive. Regions offering reliable grid interconnections, affordable power, favorable climate conditions for cooling and regulatory certainty are best positioned to benefit from this economic boom, which brings substantial tax revenue and infrastructure development.
