US data center power demand to quadruple by 2035, straining grids
A rapid expansion of artificial intelligence infrastructure will push US data center electricity consumption to a fifth of national supply by 2035, creating severe grid bottlenecks and price spikes that foreshadow global energy challenges.
Artificial intelligence is driving a massive increase in US electricity demand, with data centers expected to consume one-fifth of the country's power by 2035. According to a new report from BloombergNEF, this represents a fourfold increase from current levels as capacity surges toward nearly 200 gigawatts over the next decade.
The surge is overwhelmingly tied to AI training and inference. By 2033, the US is projected to host 64% of global AI chips by power demand, cementing its position as the primary hub for advanced computing.
These projections may still be conservative. BloombergNEF’s estimate for 2035 electricity demand is 83% higher than its December forecast. The Electrical Power Research Institute has more than doubled its 2024 estimate, while S&P raised its forecast by more than a third between October and April.
This rapid development is placing acute stress on domestic power networks. The PJM Interconnection, spanning from Virginia to Illinois, is expected to dedicate 34% of its electricity to data centers. In Texas, ERCOT will devote 22% of its generating capacity to the sector.
For European investors and policymakers, the US market serves as a stark warning about infrastructure limits. PJM recently paused new connection requests for four years before reopening its queue in April. The resulting supply-demand imbalance has already pushed regional electricity prices up 76% over the past year.
Despite the congestion, demand remains persistent. Data centers accounted for 38% of charges in PJM’s most recent capacity auction. The strain has grown so severe that American Electric Power has threatened to withdraw from the interconnection entirely.
While the US dominates AI infrastructure, the power implications are global. If current adoption rates hold, data centers will create 1,935 terawatt-hours of new electricity demand worldwide by 2033. That figure is nearly equal to India's entire annual consumption, a signal that European energy markets and tech firms must prepare for similar pressures on their own grids.
