Artificial intelligence data centres are set to devour a massive share of the world’s electricity growth over the next decade, according to BP’s latest World Energy Outlook.
The oil giant estimates that data facilities powering AI applications will account for 10% of global electricity demand growth by 2035. In the United States, the world’s most advanced AI hub, that figure could skyrocket to 40%, raising urgent questions about the strain on energy systems.
“The seemingly exponential growth in data centres to support AI provides an important new source of energy demand,” said Spencer Dale, BP’s chief economist. “This is especially significant in markets like the US, where power demand growth had virtually stalled.”
BP forecasts total global electricity demand to surge by 40% by 2035 and nearly double by 2050, largely driven by buildings, industry and transport electrification. But the rise of AI adds a new wildcard: data centre consumption is predicted to increase nine-fold by 2050, climbing from 1% of global usage in 2023 to 5% of what will then be a far larger total.
The report warns that the impact of AI could extend far beyond data centre consumption. On one hand, productivity gains might drive global energy demand 15% higher by 2035 — an impact 20 times greater than data centres alone. On the other hand, AI could slash demand through efficiency improvements in everything from industrial processes to building heating.
Despite its green energy pivot in recent years, BP’s latest analysis underscores its return to a heavier focus on oil and gas. The report delays the timeline for peak oil demand, revising projections upwards. BP now expects oil demand to reach 103.4 million barrels per day by 2030, up from last year’s forecast of 101.2 million.
The group also pointed to consumer behaviour as a key factor: motorists are holding on to older petrol cars for longer, with the average age of vehicles rising from 12 to 15 years over the past decade. That shift, combined with stubbornly high demand for petrochemicals, means oil consumption will remain elevated for longer than previously thought.
On the current trajectory, global emissions will fall only 25% by 2050, far short of the 90% cut required to meet the Paris climate accord’s 2C target.