Global data center electricity demand is projected to skyrocket by nearly 300% over the next decade, reaching 106 gigawatts (GW) by 2035, a sharp increase from the 40 GW consumed today. This significant surge, detailed in a new report from BloombergNEF, is primarily driven by the rapid expansion of artificial intelligence (AI) infrastructure and the construction of increasingly massive facilities.
The report indicates that planned data center construction shows no signs of slowing, with new additions expected to require 2.7 times the sector's current electricity demand. Much of this growth is anticipated in more rural areas as facilities expand in size and suitable urban locations become scarce, according to BloombergNEF.
A key factor behind this escalating demand is the sheer scale of upcoming data centers. Currently, only 10% of data centers draw more than 50 megawatts (MW) of electricity. However, over the next decade, the average new facility is expected to consume well over 100 MW. Hyperscale sites will significantly skew these figures, with nearly a quarter of new facilities projected to exceed 500 MW, and a few even surpassing 1 GW.
Simultaneously, the utilization rate for all data centers is forecast to rise from 59% to 69%. This increase is largely attributed to the growing demands of AI training and inference, which are set to account for nearly 40% of total data center compute power.
These findings, while substantial, are not entirely unexpected. AI companies have been aggressively investing in more powerful data centers, pushing global investment in these facilities to an estimated $580 billion this year—an amount exceeding worldwide spending on discovering new oil supplies.
The BloombergNEF report represents a significant upward revision from a document published by the group just last April. This sharp increase in projections is a direct result of a surge in newly announced projects since then. The report notes, "With an average seven-year timeline for projects to come online, developments in earlier stages affect the tail end of our forecast the most." Early-stage projects have more than doubled between early 2024 and early 2025, distinct from those already committed or under construction.
A substantial portion of this new capacity is being planned for states within the PJM Interconnection region, including Virginia, Pennsylvania, Ohio, Illinois, and New Jersey. The PJM Interconnection is a regional transmission organization responsible for operating the electrical grid in these states, along with Delaware, West Virginia, and parts of Kentucky and North Carolina. Texas's Ercot grid is also slated for a large number of additions.
Grid Operators Raise Concerns Over Soaring Demand
This report emerges amidst heightened scrutiny of the PJM Interconnection by its independent monitor, Monitoring Analytics. The group recently filed a complaint with the Federal Energy Regulatory Commission (FERC), arguing that PJM possesses the authority to approve new data center connections only when its grid has adequate capacity.
"As part of its obligation to maintain reliability, PJM has the authority to require large new data center loads to wait to be added to the system until the loads can be served reliably," Monitoring Analytics stated in its complaint. "PJM has the authority to create a load queue."
Furthermore, Monitoring Analytics contends that data centers are a primary contributor to the current high electricity prices within the PJM region.
"PJM's failure to clarify and enforce its existing rules and to protect reliable and affordable service in PJM is unjust and unreasonable," the organization asserted.
