Trend Market-driven micro-level efficiency innovation offsets part of new electricity demand

Summary

In energy-intensive industries and digital infrastructure, companies are cutting electricity per unit of output even as they expand capacity. Unlike efficiency programmes rolled out uniformly by policy, these gains accumulate autonomously through competition and cost-cutting incentives. Examples include higher cloud computing productivity, pruned and distilled AI models and AI-based predictive control of cooling in chip fabrication plants. Even if data centres, advanced industry and electrification lift demand, such in-sector improvements could offset a substantial part of the increase. This makes the pace of micro-level efficiency a key uncertainty for long-range electricity planning.