Data centers now attract more investment than finding new oil supplies

A recent International Energy Agency (IEA) report highlights the growing economic and energy significance of data centers, revealing that global spending on data centers this year will reach $580 billion—surpassing investment in new oil supplies by $40 billion. This shift underscores the increasing digitalization of economies worldwide. The report projects a fivefold increase in electricity consumption from AI data centers by 2030, doubling the current total energy use of all data centers. Half of this growth is expected in the U.S., with Europe and China accounting for most of the remainder. Data center expansion is concentrated in large urban areas, often forming clusters near existing facilities, which is causing challenges such as grid congestion and long connection wait times—up to a decade in places like northern Virginia, and a complete pause on new connections in Dublin until 2028. The IEA also notes supply chain constraints affecting grid upgrades, including shortages of cables, critical minerals, gas turbines, and transformers. Innovations like solid-state transformers promise improvements in