Wisconsin's Industrial Real Estate Team reposted this
The Data Center / AI Boom continues to fuel a robust commercial construction outlook for the United States (projected CAGR close to 10%). With growth comes challenges (and opportunities), and there is an immense strain that artificial intelligence (AI) is placing on the U.S. power grid as tech companies seek vast amounts of electricity to fuel data centers. In some cases, these centers require as much power as entire cities. For instance, some AI campuses are requesting up to a gigawatt of power—roughly equivalent to the electricity used by San Francisco. In Ohio, American Electric Power (AEP) reports having "three New York Cities' worth" of data center power requests lined up, but the current infrastructure cannot support such demands. These power needs are overwhelming the high-voltage transmission systems, leading to moratoriums and rationing in regions like Salt Lake City, California, and Virginia. Some data center projects are now facing delays that could extend into the next decade. This surge in demand coincides with other strains on the grid, including electric vehicle infrastructure and new manufacturing plants spurred by IRA Incentives. To manage the growing demand, utilities are proposing long-term contracts and higher rates to secure commitments from tech companies and avoid overbuilding. Industry is experiencing a generational demand surge for electricity and we will be forced to invest in new capacity or we will be left behind. With a stable climate, dependable electrical grid, and recent legislation such as ACT 19 (data center sales tax and use tax exemption) Wisconsin is well-positioned to be a national leader in attracting new data center development. (Sources:WSJ "‘Three New York Cities’ Worth of Power: AI Is Stressing the Grid)
