From nuclear to quantum computing, how Big Tech intends to power AI’s insatiable thirst for energy
Industrial chiller at Yotta Data Services Pvt. data center, in Navi Mumbai, India, on Thursday, Mar. 14, 2024.
Bloomberg | Bloomberg | Getty Images
A huge upswing in the number of data centers worldwide shows no signs of slowing down, prompting Big Tech to consider how best to power the artificial intelligence revolution.
Some of the options on the table include a pivot to nuclear, liquid cooling for data centers and quantum computing.
Critics, however, have said that as the pace of efficiency gains in electricity use slows, tech giants should recognize the cost of the generative AI boom across the whole supply chain — and let go of the “move fast and break things” narrative.
“The actual environmental cost is quite hidden at the moment. It is just subsidized by the fact that tech companies need to get a product and a buy-in,” Somya Joshi, head of division: global agendas, climate and systems at the Stockholm Environment Institute (SEI), told CNBC via video call.
A wave of data center investment is expected to accelerate even further in the coming years, according to the International Energy Agency, primarily driven by growing digitalization and the uptake of generative AI.
It is this prospect that has stoked concerns about an electricity demand surge — as well as AI’s often-overlooked but critically important environmental impact.
Data centers, which consume an ever-increasing amount of energy, represent a key piece of infrastructure behind modern-day cloud computing and AI applications.
Giampiero Frisio, president of electrification at Swiss multinational ABB, said the engineering group’s data center business has enjoyed remarkable growth in recent years — with the segment on track to grow by more than 24% in 2024.
Frisio said ABB has been well placed in the AI demand boom to supply mid-sized and big-name industry players with all the components needed to run a data center.
“I think the best way to act now is to increase the energy efficiency. That’s the best way because the technology is there, for example the medium voltage HiPerGuard UPS. You can do it, and you can do it tomorrow morning,” Frisio told CNBC via video call.
The HiPerGuard UPS refers to ABB’s industry-first medium voltage uninterruptable power supply, which it says can provide continuous power to large facilities.
A server room at a data center in India.
Dhiraj Singh | Bloomberg | Getty Images
“The second one is to move on the liquid cooling, there is no doubt. Again, this is in the optic of better energy efficiency. Why? Because a single rack, you know the black boxes that look like a wardrobe with all the servers inside, the power density of those is going to be four to six times than before,” Frisio said.
“After that, we are talking about five to 10 years from now, it is the nuclear modular system,” he added.
Big Tech is going nuclear
U.S. tech behemoths Microsoft, Google and Amazon have all secured nuclear energy deals worth billions of dollars in recent months as they seek to bring additional energy capacity online to train and run the massive generative AI models behind today’s applications.
The upsurge of generative AI demand has coincided with a push to find more efficient cooling solutions in data centers, particularly liquid cooling — a process in which water is used to lower the temperatures of servers and other electronic equipment.
I think in the summer of every great technology we discover there is a winter — but don’t pay attention to it until winter arrives.
Raj Hazra
CEO of Quantinuum
French power-equipment maker Schneider Electric recently completed an $850 million deal to take a controlling stake in Motivair Corp, a U.S.-based company that specializes in liquid cooling for high-performance computing.
Schneider Electric CEO Peter Herweck told CNBC last month that the all-cash deal, which is designed to bolster its offering to data centers, was “rich, but not overly expensive” and “fits great” with the firm’s strategy.
Alongside nuclear energy and liquid cooling technology, some tech players have suggested developments within AI could help to decarbonize data centers.
Former Google CEO Eric Schmidt, for example, said last month that since “we’re not going to hit the climate goals anyway”, investing in AI could be pivotal to solving some of our biggest environmental challenges.
SEI’s Joshi flatly rejected this point of view.
“These arguments are not new, they are very much in line with the sort of ‘silver bullet’, ‘tech will save us’ rhetoric,” Joshi said.
“There is something inherently at odds with saying we operate within certain finite planetary boundaries and yet by exceeding them and continuing with the same extractive narratives, we are somehow going to solve the problem that we’re in now,” she added.
Quantum computing
“I think in the summer of every great technology we discover there is a winter — but don’t pay attention to it until winter arrives,” Raj Hazra, CEO of Quantinuum, the world’s largest integrated quantum computing company, told CNBC via video call.
“That is my way of describing what is happening with generative AI, the infrastructure needed to support it [and] the massive data centers that have to be built.”
Hazra said optimism over the generative AI boom is already straining the cost of running the technology.
Aerial view of a data center owned by the US multinational and technology company Google in Santiago on October 9, 2024. The drought that is affecting part of South America, coupled with public pressure, is forcing technology giants such as Google, Amazon, and Microsoft to reformulate their data center projects in the region in favor of low-water consumption ones.
Rodrigo Arangua | Afp | Getty Images
“As wonderful as AI is, there are two challenges to it. One is, is it sustainable from a resource standpoint? The other is, is it responsible?” Hazra said. “The reason I bring up this context is because quantum is critical to both of them.”
Quantum computing refers to an area of computer science that uses the laws of quantum mechanics to solve extremely complex problems.
Hazra said a “who’s who” of businesses and strategic investors have recently expressed an interest in Quantinuum, with the company raising around $300 million in its latest equity funding round. Honeywell, which is the firm’s majority shareholder, said the fundraise put Quantinuum’s valuation at $5 billion.
“One of the things that has become quite apparent is it’s no longer OK to say I have a solution to a problem; you have to say I have a sustainable solution to a problem,” Hazra said.
The CEO said one of quantum’s biggest contributions to society can be to make AI both sustainable and responsible.
“I predict that in the next three to five years, you will see people say, what is my compute infrastructure for running my business? It will be a combination of high-performance computing, AI and quantum,” he added.
Leading yard operation 3PL YMX Logistics has announced plans to deploy fully twenty (20) of Orange EV’s fully electric Class 8 terminal trucks at a number of distribution and manufacturing sites across North America.
As the shipping and logistics industries increasingly move to embrace electrification, yard operations have proven to be an almost ideal use case for EVs, enabling companies like Orange EV, which specialize in yard hostlers or terminal tractors, to drive real, impactful change. To that end, companies like YMX are partnering with Orange EV.
“This relationship between YMX and Orange EV is a significant step forward in transforming yard operations across North America,” said Matt Yearling, CEO of YMX Logistics. “Besides the initial benefits of reduction in emissions and carbon footprint, our customers are also seeing improvements in the overall operational efficiency and seeking to expand. Our team members have also been sharing positive feedback about their new equipment and highlighting the positive impact on their health and day-to-day activities.”
This Orange looks good in blue
One of the most interesting aspects of this story – beyond the Orange EV HUSK-e XP’s almost unbelievable 180,000 lb. GCWR spec. – is that this isn’t a story about California’s ports, which mandate EVs. Instead, YMX is truly deploying these trucks throughout the country, with at least four currently in Chicago (and more on the way).
“Our collaboration with YMX Logistics represents a powerful stride in delivering sustainable yard solutions at scale for enterprise customers,” explains Wayne Mathisen, CEO of Orange EV. “With rising demand for electric yard trucks, our joint efforts ensure that more companies can access the environmental, financial, and operational benefits of electrification … this is a win for the planet, the workforce, and the bottom line of these organizations.”
We interviewed Orange EV founder Kurt Neutgens on The Heavy Equipment Podcast a few months back, but if you’re not familiar with these purpose-built trucks, it’s worth a listen.
HEP-isode 26
SOURCE | IMAGES: YMX Logistics.
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On today’s thrilling episode of Quick Charge, we’ve got the all-new Hyundai IONIQ 9 and its “a “rolling living room” pivoting captain’s chairs, Kia gets a go-fast 7 passenger SUV and an updated EV6, while Honda announces plans to start producing solid-state batteries at its new facility in just a few weeks.
We’ve also got big news for American workers – a Minnesota power company is ditching coal for solar while ExxonMobil and LG Chem get to work extracting thousands of tons of lithium out of Tennessee’s soil.
Today’s episode is sponsored by BLUETTI, a leading provider of portable power stations, solar generators, and energy storage systems. For a limited time, save up to 52% during BLUETTI’s exclusive Black Friday sale, now through November 28, and be sure to use promo code BLUETTI5OFF for 5% off all power stations sitewide. Learn more by clicking here.
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Read more: Farm-fegnugen? Volkswagen rolls out an electric tractor.
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Arevon Energy has kicked off operations at Vikings Solar-plus-Storage – one of the US’s first utility-scale solar peaker plants.
The $529 million project in Imperial County, California, near Holtville, features 157 megawatts of solar power paired with 150 megawatts/600 megawatt hours of battery storage.
Vikings Solar-plus-Storage is designed to take cheap daytime solar power and store it for use during more expensive peak demand times, like late afternoons and evenings. The battery storage system can quickly respond to changes in demand, helping tackle critical grid needs.
Vikings leverages provisions in the Inflation Reduction Act that support affordable clean energy, strengthen grid resilience, boost US manufacturing, and create good jobs.
The Vikings project has already brought significant benefits to the local area. It employed over 170 people during construction, many local workers, and boosted nearby businesses like restaurants, hotels, and stores. On top of that, Vikings will pay out more than $17 million to local governments over its lifespan.
“Vikings’ advanced design sets the standard for safe and reliable solar-plus-storage configurations,” said Arevon CEO Kevin Smith. “The project incorporates solar panels, trackers, and batteries that showcase the growing strength of US renewable energy manufacturing.”
The project includes Tesla Megapack battery systems made in California, First Solar’s thin-film solar panels, and smart solar trackers from Nextracker. San Diego-based SOLV Energy handled the engineering, procurement, and construction work.
San Diego Community Power (SDCP) will buy the energy from the Vikings project under a long-term deal, helping power nearly 1 million customer accounts. SDCP and Arevon have also signed an agreement for the 200 MW Avocet Energy Storage Project in Carson, California, which will start construction in early 2025.
Vikings is named after the Holtville High School mascot, and Arevon is giving back to the local community by funding scholarships for deserving Holtville High students.
Arevon is a major renewable energy developer across the US and a key player in California, with nearly 2,500 MW in operation and more than 1,250 MW under construction.
Read more: Minnesota’s largest coal plant goes solar: Sherco Solar comes online
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