AI Electricity use: a lot or a little

There’s long been a disconnect between concerns about the massive impact of AI data centres on electricity demand and claims by Sam Altman and others that the impact is really modest. Ed Zitron recently posted a summary of OpenAI’s 2025 accounts which helps to clarify things a bit. In short, if you look at actual electricity demand needed for current AI use, it’s small. And that doesn’t change if demand grows at high but plausible rates. On the other hand, if you look at what is needed to justify the current valuations of AI and its competitors, the implied growth is staggering. Starting with demand, the OpenAI accounts break out current revenue (what people are paying to use ChatGPT etc) and the cost of revenue (the costs of the data centres used to answer queries) The cost of revenue is about $8 billion (rounded for simplicity). A conveniently scaled measure of electricity output is a Terawatt hours (TWh). Roughly equal to the annual output of a typical 1GW coal-fired or nuclear…