The surge in generative artificial intelligence is boosting revenue for major tech companies, but the heavy energy demand is increasingly contributing to climate change.
Earlier this month, Google reported a 48% increase in carbon emissions since 2019, mainly due to the energy consumption of data centers and supply chain emissions. According to its 2024 Environmental Report, Google’s carbon emissions went up by 13% year-over-year in 2023.
Back in 2021, Google aimed for net-zero emissions across its operations and value chain by the end of the decade. However, the company announced in the report that starting in 2023, it would no longer maintain operational carbon neutrality, opting instead to focus on other carbon solutions and partnerships to achieve the net-zero goal.
Similarly, Microsoft set a goal in 2020 to be “carbon negative” by the end of the decade. Nevertheless, Microsoft’s 2024 Environmental Sustainability Report revealed that its carbon emissions have risen by almost 31% since 2020. The increase is largely due to the expansion of data centers for AI workloads and the need for more hardware like semiconductors and servers.
“Our challenges are partly unique to our position as a leading cloud supplier expanding its datacenters,” Microsoft stated. “But they also reflect the global challenge of developing and using greener materials like concrete, steel, fuels, and chips.”
In April, Ami Badani, chief marketing officer of British chip designer Arm, mentioned that data centers powering AI chatbots, such as OpenAI’s ChatGPT, account for 2% of global electricity consumption. This demand could potentially slow down AI progress. Despite Google’s significant carbon footprint, a study by Goldman Sachs found that a query on ChatGPT requires nearly 10 times as much electricity as a Google search.
According to the Electric Power Research Institute, by 2030, data centers in the U.S. could consume up to 9% of the nation’s electricity, more than twice the current usage. Reports suggest that a third of U.S.-based nuclear power plants are in discussions with tech companies to supply electricity. In April, OpenAI’s CEO Sam Altman was among investors in Exowatt, a startup developing modules that store energy as heat and generate electricity for AI data centers.