How to Make AI Less of a Power Guzzler

Artificial intelligence is poised to transform both work and everyday life. But it has a dark underside: AI computer centres consume enormous amounts of electricity and water, to power their processing chips and cool the heat they emit.

Annual U.S. electricity use by data centres of all types will rise from 3% to 4% of the nation’s total today to between 11% and 12% in 2030, with AI being the main driver, according to projections from consulting firm McKinsey.

Meantime, AI’s demand for water globally in 2027 could account for more than the total annual amount withdrawn for use in Denmark or half of that in the U.K., according to researchers at the University of California, Riverside and University of Texas at Arlington.

All of that heavy use is causing logistical and public-image problems for the industry. Some utilities struggle to supply the needs of AI providers, and communities push back, fearing the added use will boost power prices and deplete water supplies.

The biggest AI providers, including Amazon , Alphabet Inc.’s Google, Meta and Microsoft , say they are working to be both carbon-neutral and replenish more water than they use—even as they continue to build massive data centres.

“It will be harder to build data centres, especially where energy already is at a premium or water might be scarce,” says Ed Anderson, research vice president at technology advisory firm Gartner. But, he adds, “the economic opportunity is rich enough that the providers will find a way.”

Below are some of the steps tech companies and researchers are hoping will reduce AI’s appetite for power and water.

Making chips more efficient

One way of addressing power consumption is to make chips less power hungry. Nvidia , the largest maker of AI processors, says its newest ones, called Blackwell, will be about 25 times as energy efficient as its previous high-end version. Meanwhile, Amazon, Google, Meta and Microsoft are designing their own processing chips, in part to cut costs but also to make them use less power.

“Each generation has been significantly more efficient than the prior one,” says Google’s Partha Ranganathan , a vice president and engineering fellow, speaking of his company’s processing units.

Different sources for water

Equipment used to cool data centres creates another issue: where to get the vast amount of water these systems consume. Google says its data centers globally used about 6.1 billion gallons of water in 2023, equivalent to the water used to irrigate and maintain 40 golf courses in the Southwest each year.

OpenAI’s GPT-3 model, meantime, consumes the equivalent of a 16.9-ounce bottle of water for every 10 to 50 responses it provides to users’ queries, according to the researchers at UC Riverside and UT Arlington. OpenAI declined to comment on the finding.

Data-centre water typically comes from municipal water systems. But in an era of water shortages, diverting drinking water for an industrial use has created tensions in some locales. That has sent AI companies searching for other sources, including rainwater, treated wastewater or water left over from factory processes.

Amazon, for example, uses recycled wastewater for cooling at its Santa Clara, Calif., data centers. The water comes from the city’s sewage-treatment system after it undergoes a three-step process that removes 99% of impurities.

Smarter training for AI

Some researchers have experimented with carefully controlling what kind and how much information an AI model takes in during training. Usually, training a so-called large language model AI, such as OpenAI’s ChatGPT and Microsoft’s Copilot, involves ingesting hundreds of billions of words from the internet and elsewhere, then learning the relationships among them.

And that is energy and water intensive. Training an AI model called BLOOM over a 3½-month period consumed enough electricity to power the average U.S. home for 41 years, according to a Stanford University report.

As for water, training one of Google’s AI models, known as LaMDA, used about two million liters of it, both to produce the electricity used and keep the computers cool—enough to fill about 5,000 bathtubs, according to Shaolei Ren , a professor of electrical and computer engineering at the University of California, Riverside. Google declined to comment on the research, but said it is “committed to climate-conscious cooling of our data centres.”

One possible solution is to have AIs remove redundancy and low-quality data, instead of just vacuuming up the whole internet. The goal is a much smaller set of data that the AI system can more easily sift through when a user asks it a question.

This can lower electricity consumption, according to some researchers.

AI systems that limit the information they take in are also less likely to “hallucinate”—give false or misleading answers—and can respond in ways that are more on-point because of the higher quality of the data they contain, experts say. Microsoft found that one of its pared-down AIs exceeded that of vastly larger ones in measurements of common sense and logical reasoning .

Dialling down the juice

Researchers at several universities have found that capping the amount of electricity used by AI computers has only a minor effect on the outcome, such as slightly more processing time.

Experts at the Massachusetts Institute of Technology and Northeastern University say that reducing the power to one of Meta’s AIs by 22% to 24% slowed the speed at which the AI responded to a query by only 5% to 8%. “These techniques can lead to significant reduction in energy consumption,” the researchers say. They add that the method also caused the processors to run at a lower temperature—which could trim the need for cooling.

Meta declined to comment on the research, but said it has had efforts to boost data-centre energy efficiency “since we started designing our first data center over a decade ago.”

Meantime, a team at the University of Michigan, University of Washington and University of California, San Diego devised an algorithm to modulate the use of power during training. The technique could cut power use by up to 30% , they say.

Show users AI’s impact

Some researchers believe companies should give users more context about the environmental impact of AI, to let them make more-informed decisions about the technology. Ren, of UC Riverside, proposes that AI providers disclose the approximate amount of electricity and water each query consumes—akin to how Google tells people searching for flights the amount of carbon emissions each trip would create.

Another proposal is to devise a rating system for the power efficiency of AI systems, akin to the government’s Energy Star ratings for home appliances and other products. Such a system could help people choose AI models for differing tasks based on their energy consumption, according to Sasha Luccioni , an AI researcher at Hugging Face, a company that makes machine-learning tools.

Using greener power

Academics and others have come up with other proposals to minimise AI’s environmental impact by tapping into green energy. For instance, companies might build more data centers in countries with abundant, low-emission power, such as hydropower in Norway or geothermal in Iceland. Or companies might do AI calculations at different locations at different times of the day, such as deploying computer centers with high use of solar power during the daytime or wind-powered ones when wind is more reliable at night.

Chilling the computers

Data-centre computers put out tremendous amounts of heat, and their temperature must be kept in a certain range, often 64 to 72 degrees, to prevent damaging the electronics. Traditionally, this has been done by high-power air conditioning. But air conditioning uses up to 40% of all the electricity consumed by a typical data centre, while devices called cooling towers that expel the heat to the outside air use a lot of water.

In response, the data-centre industry is moving to liquid cooling, which circulates a special liquid or cold water to “cold plates” that sit on top of the processor chips and keep them at a safe and efficient temperature range. The system, called direct-to-chip liquid cooling, uses less power than the traditional method—about 30% less, Nvidia says—because liquid is vastly better at removing heat from the electronics than blowing cold air over them.

Another method under development, called immersion cooling, involves placing the computers themselves inside big tanks of cooling liquid. While showing early promise, there are environmental concerns about the chemicals often used in the setup, says Mark Russinovich , chief technology officer of Microsoft’s Azure cloud-computing unit.

Some companies, meanwhile, are using computing gear that can withstand higher temperatures and doesn’t need as much cooling. Google says its data centres already are 1.8 times as energy efficient as the typical data centre, which it achieved in part by raising the inside temperature to 80 degrees. For every one-degree boost in their temperature, data centres can save 4% to 5% in energy costs, according to the Energy Star program.

Former New Hampshire Gov. Chris Sununu delivered a warning to Treasury Secretary Scott Bessent during a recent visit to Washington: Already-high airfares will surge if the war in Iran doesn’t end soon.

Sununu, a Republican who represents some of the biggest airlines as president of the industry group Airlines for America, has for weeks sounded the alarm to Trump administration officials about the economic fallout from high jet fuel prices. The war, Sununu has argued, must come to a close soon, or things will get worse.

Administration officials have gotten the message.

Privately, President Trump’s advisers are increasingly worried that Republicans will pay a political price for the rising fuel costs, according to people familiar with the matter. Many of those advisers are eager to end the war, hoping prices will begin to moderate before November’s midterm elections.

The fallout from the U.S.-Israeli attack in late February has slowed traffic through the Strait of Hormuz, a vital shipping lane, triggering a sharp increase in oil, gasoline and jet-fuel prices.

That means consumers are grappling with high costs ahead of the summer travel season, as they consider vacation plans.

Sixty-three per cent of Americans said they put a great deal or a good amount of blame on Trump for the increase in gas prices, according to a new poll conducted by NPR, PBS and Marist.

More than 8 in 10 Americans said struggles at the gas pump are putting strain on their finances.

Jet-fuel prices roughly doubled in a matter of weeks after the war began, and they have remained high. Airlines have said that will add billions of dollars of additional expenses this year, squeezing profit margins.

U.S. airlines spent more than $5 billion on fuel in March—up 30% from a year earlier, according to government data.

Carriers have been raising ticket prices, hoping to pass the cost along to consumers, and they are culling flights that will no longer make money at higher price levels.

In March, the price of a U.S. domestic round-trip economy ticket rose 21% from a year earlier to $570, according to Airlines Reporting Corp., which tracks travel-agency sales.

So far, airlines have said the higher fares haven’t deterred bookings and they are hoping to recoup more of the fuel-cost increases as the year goes on.

Earlier this week, Trump said the current price of oil is “a very small price to pay for getting rid of a nuclear weapon from people that are really mentally deranged.”

Secretary of State Marco Rubio told reporters that if Iran got a nuclear weapon, the country would have more leverage to keep the strait closed and “make our gas prices like $9 a gallon or $8 a gallon.”

Trump has taken steps in recent days to bring the war to an end. Late Tuesday, the president paused a plan to help guide trapped commercial ships out of the Strait of Hormuz, expressing optimism that a deal could be reached with Iran to end the conflict.

Crude oil prices fell below $100 a barrel on Wednesday, after reports that Iran and the U.S. are working with mediators on a one-page framework to restart negotiations aimed at ending the conflict and opening the strait.

Sununu said Trump administration officials are conscious of the economic fallout from the war: “They get it…and I think that’s why they’re trying to get through the war as fast as they can.”

But he cautioned that it could take months for prices to return to prewar levels.

“Ticket prices won’t go down immediately” after the strait is fully reopened, Sununu said. “You’re looking at elevated ticket prices through the summer and fall because it takes a while for the prices to go down.”

Since the initial U.S.-Israeli attack in late February, Sununu has met in Washington with National Economic Council Director Kevin Hassett, representatives from the Transportation Department and senior White House officials.

A White House official confirmed that Hassett and Sununu have discussed the effect of increased fuel prices on the airline industry. The official said the conversation touched on how the industry can mitigate the impact of high jet fuel prices on consumers.

“The president and his entire energy team anticipated these short-term disruptions to the global energy markets from Operation Epic Fury and had a plan prepared to mitigate these disruptions,” White House spokeswoman Taylor Rogers said, pointing to the administration’s decision to waive a century-old shipping law in a bid to lower the cost of moving oil.

Rogers said the administration is working with industry representatives to “address their concerns, explore potential actions, and inform the president’s policy decisions.”

A Treasury Department spokesman pointed to Bessent’s recent comments on Fox News that the U.S. economy remains strong despite price increases. The spokesman said Treasury officials have met with airline executives, who have reaffirmed strong ticket bookings.

“We’re cognizant that this short-term move up in prices is affecting the American people, but I am also confident, on the other side of this, prices will come down very quickly,” Bessent told Fox News on Monday.

The war has already contributed to one casualty in the industry: Spirit Airlines. Company representatives have said they were forced to close the airline because the sustained surge in jet-fuel prices derailed the company’s plan to emerge from chapter 11 bankruptcy.

The Trump administration and Spirit failed to come to an agreement for the company to receive a financial lifeline of as much as $500 million from the federal government.

Transportation Secretary Sean Duffy has argued that the Iran war wasn’t the cause of Spirit’s demise, pointing to the company’s past financial struggles, as well as the Biden administration’s decision to challenge a merger with JetBlue.

Other budget airlines have also turned to the federal government for help since the U.S.-Israeli attack. A group of budget airlines last month sought $2.5 billion in financial assistance to offset higher fuel costs, and they separately wrote to lawmakers asking for relief from certain ticket taxes.