Cloud computing has been one of the consistent success stories in the tech world and thrived mostly during the COVID-19 pandemic period. Organizations today are increasingly relying on cloud infrastructure. The global spending on cloud services has surged and about $80 billion per quarter, which is a 22% increase year-over-year.
Data centers are energy-intensive and require vast amounts of electricity for networking, cooling and power distribution. Demand for AI services is set to double U.S. power consumption by 2030 and the energy required is becoming a critical issue. Operators are already feeling the strain and some are even predicting that power shortages could stifle growth within the next two years.
Cloud operators are exploring various solutions to address the challenge. Amazon Web Services (AWS) has acquired a data center campus next to a nuclear power plant in Pennsylvania. The location is strategic and allows AWS to tap into a steady supply of electricity to ensure long-term viability of its operations. However, deploying SMRs at scale is still years away.
Nuclear power does offer a promising solution, but it is equipped with challenges too. AWS’s nuclear-powered data center has faced objections from utility companies as they worry that it could reduce the amount of energy available to the grid. Hence, it is a broader challenge of balancing energy needs of cloud computing with those of the wider community.
Renewable energy sources are also being explored. Companies like Google and Meta have signed contracts to add renewable energy to the grid. IceCloud Integrated Services in Iceland is leveraging the abundant geothermal and hydropower resources of the country to offer a cloud service that is powered entirely by renewables.
