(Aug 25): China’s data centres will quadruple their electricity consumption by the end of the decade, according to Wood Mackenzie Ltd, by which point they will use more power than South Korea does now.

Rapid growth in artificial intelligence workloads will see data centres use 774 terawatt-hours of electricity by 2030, around 6% of China’s total projected consumption, WoodMac said in a report released on Tuesday. The proportion would rise to 17% by 2060, it said.

The AI boom highlights the challenge for China and other countries in ramping up electricity generation to meet the surging demand. In the US, a backlash against the rapid buildout of data centres, which also consume a lot of water, is becoming an election issue and a factor in Wall Street stock recommendations.

While data centres have tended to cluster around major cities and technology hubs, China’s AI expansion is now shifting to a “compute follows power” model, WoodMac said. Sparsely populated regions in the western part of the country offer abundant land and growing renewable generation capacity, creating opportunities to locate close to power sources, it said.

“As AI drives sustained growth in computing demand, access to reliable, cost-competitive and lower-carbon electricity will play a growing role in determining where and how new data-centre capacity is developed,” Wanting Zhao, a Woodmac analyst for Asia-Pacific power and renewables, said in the report.

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