Data center energy demand forecasted to soar nearly 300% through 2035

Planned data center construction shows no signs of fading, with new additions requiring 2.7 times — nearly three times — the sector’s current electricity demand over the next decade, according to a new report from BloombergNEF.

By 2035, data centers will consume 106 gigawatts, a sharp rise from the 40 gigawatts they use today. Much of this growth will occur in more rural areas as facilities grow in size and as locations near urban areas become scarce, Bloomberg said.

The driving part of the growth is the sheer volume of data centers planned. Today, only 10% of data centers consume more than 50 megawatts of electricity, but over the next decade, the average new facility will consume more than 100 megawatts. The largest sites help skew the data: nearly a quarter of them will be larger than 500 megawatts, and some will exceed 1 gigawatt.

Meanwhile, utilization for all data centers is expected to grow from 59% to 69% as AI training and inference grows to nearly 40% of total data center compute.

In some ways, the findings in the new report are not surprising. Artificial intelligence companies are racing to build more powerful data centers, helping push global investment in the facilities to as much as $580 billion this year. This is more than the world spends on finding new supplies of oil.

However, the new report shows how quickly the landscape is changing. It is a sharp upward revision to the document the group published in April. This rise was driven by the increase in new projects announced since then. “With an average timeline of seven years for project start-ups, early-stage developments impact the endpoint of our forecasts the most,” the new report said.

Early-stage projects more than doubled between early 2024 and early 2025, although this differs from projects that are committed or currently under construction.

Much of this new capacity is planned in Virginia, Pennsylvania, Ohio, Illinois and New Jersey. It lies within an area known to industry experts at PJM Interconnection, a regional transmission organization charged with operating the electric grid in those states and others, including Delaware, West Virginia and parts of Kentucky and North Carolina. Ercot’s network in Texas will see a slew of additions as well.

The report comes as PJM Interconnection is under scrutiny from its independent monitor, Monitoring Analytics. The group filed a complaint with the Federal Energy Regulatory Commission (FERC) saying PJM has the authority to allow new data center connections only when its network has sufficient capacity.

“As part of its commitment to maintaining reliability, PJM has the authority to order new large loads for the data center to wait to be added to the system so that the loads can be served reliably,” Monitoring Analytics wrote. “PJM has the authority to create the upload queue.”

Moreover, the organization said that data centers are responsible for today’s high electricity prices within the region.

“PJM’s failure to clarify and enforce its existing rules and protect reliable, affordable service at PJM is unfair and unreasonable,” she said.