Data centers are playing a significant role in driving a surge in electricity demand, particularly from AI platforms like ChatGPT. According to Goldman Sachs, the U.S. is expected to see a major increase in electricity consumption due to the rapid expansion of data centers powering AI technologies. The report forecasts a 2.4% rise in electricity demand from 2022 to 2030, with data centers accounting for 0.9 percentage points of the total increase.
The Electric Power Research Institute (EPRI) estimates that data centers could consume up to 9% of U.S. electricity generation by 2030, highlighting the significant impact of AI platforms on energy consumption. With over 180 million users currently, ChatGPT is just one example of AI technology that requires substantial electricity to operate efficiently.
To meet the escalating demand for electricity, major tech companies such as OpenAI, Microsoft, Google, Meta, and Amazon are investing billions in expanding data center capacity. Natural gas is expected to play a key role in generating 60% of the growth from AI and data centers, with renewables contributing the remaining 40%.
The growing demand for electricity is also impacting the natural gas and copper markets. Natural gas prices, which have declined this year, are expected to rebound as demand surges. Copper, a critical mineral essential for AI and clean energy technologies, is experiencing a significant price increase due to supply constraints and rising demand.
Investors looking to capitalize on these trends may consider investing in natural gas companies or ETFs focused on the sector. Similarly, exposure to copper through mining companies or ETFs could provide attractive returns given the metal’s essential role in the energy transition. Ivanhoe Mines, with its recent expansion at the Kamoa-Kakula Copper Complex, remains a top pick for investors seeking exposure to the copper market.
As the demand for electricity continues to grow, driven by AI, EVs, and the energy transition, natural gas and copper are poised to play crucial roles in meeting power needs and providing investment opportunities. With the right strategy and a focus on these key sectors, investors can position themselves to benefit from the evolving energy landscape.
