AI's clean energy dilemma

NEWS

AI’s clean energy quest

What happened: Big tech is wrestling with AI’s energy footprint. The rapid growth of AI is raising questions about its massive energy consumption, while some tech leaders argue that AI itself is a key to addressing climate change. 

In context: Energy use from data centres could double by 2026 according to the IEA, driven by AI development. Energy-hungry data centres aren’t new, but while centre workloads tripled from 2015 to 2019, better energy efficiency kept power use flat.

AI is a step level change - for example, one ChatGPT query takes 10x more power than a Google search. 

Why it matters: That growth in energy use risks a significant increase in emissions. Both Microsoft and Google reported emissions increases from building new data centres, mostly from embodied emissions in steel, concrete, etc. 

Some companies are turning to natural gas as a fast, low-cost option for baseload capacity. This could lock in emissions for decades, given the average 30-year lifespan of these plants. 

The energy demands of AI also compete with other decarbonization efforts for clean energy. CarbonCapture recently had to relocate a carbon removal project because of intense competition for energy with data centres. 

Yes, but: This energy race also has the potential to accelerate clean energy adoption and scale. Tech companies are investing billions in data centres and securing the energy to power them, like a new $100 billion partnership led by Microsoft and BlackRock. 

That capital, deployed into clean energy, could help companies deploy projects, drive down the learning curve, and scale faster. Power purchase agreements from big tech helped drive a solar and wind boom in Alberta; Google and Meta are tapping startups like Fervo and Sage Geosystems for geothermal baseload power; and Microsoft is helping pull off a huge feat to reboot nuclear reactors at Three Mile Island. More opportunities existing in energy efficiency, energy storage, and cooling.

The bottom line: AI has significant potential to enable and accelerate climate solutions like energy optimization and forecasting, discovering new materials, or land use and crop optimization. But the massive appetite for energy and momentum behind AI adoption is a huge risk for the climate.

The answer probably isn’t to give up and wait for AI to solve the problem for us, but instead harness it as a catalyst for clean energy abundance. Never let a crisis go to waste. 

CLIMATE CAPITAL

🦗 Entosystem (Drummondville, QC) raised $58 million to expand its insect farming business led by Idealist Capital, Sanimax, and Fondaction. Entosystem diverts organic waste to produce organic fertilizer and protein meal from black soldier fly larvae.

🏢 Mysa (St. John’s, NL) secured $11 million from existing investors to scale its smart energy management products like thermostats for residential and commercial buildings. 

🔋Nano One (Burnaby, BC) received a $17.8 million grant from the US Department of Defense to support R&D and production capacity for their lithium iron phosphate processing plants. The grant is part of US efforts to secure access to battery materials produced in North America.

⚛️ Prodigy Clean Energy (Montreal, QC) received $2.75 million from the federal government to support R&D efforts for their transportable nuclear power plants. The feds announced a total of $13.6 million in research funding.

MILESTONES & PRODUCT

🏅Climate tech dominated pitch competitions at Elevate Festival in Toronto. Infinite Harvest (upcycling agricultural waste into insect protein), CERT Systems (turning CO2 into high value chemicals), and Aruna Revolution (plastic-free, compostable menstrual pads) all took home prizes.

💡Tech hub MaRS laid off additional staff as it resets its business model to rely less on public funding and double down on cleantech and healthtech. 

🤝 Modern Niagara opened a new sustainability-focused innovation hub in Kingston, ON featuring wet labs, manufacturing space, and more.

💧 Water tech company H2O Innovation acquired US-based NextEra Distributed Water to build out its  water infrastructure business.

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IN THE NEWS

🌬️ New legislation aims to unlock offshore wind developments off the East Coast. Bill C-49 finally passed to create a clearer regulatory regime for offshore wind development. The bill includes a shared management framework with Nova Scotia and Newfoundland and Labrador, an expanded mandate for offshore energy regulators, and a licensing regime for underwater land.

💸 Ontario is rolling out new incentives to install heat pumps in areas facing growing electricity consumption. The rebates, which require homeowners to make the upgrade and receive the rebate later, are intended to reduce strain on the grid with energy efficient heating systems. 

⛏️ A gap in upstream financing is holding back Canada’s critical minerals according to a new industry survey carried out by the Canadian Climate Institute. Permitting delays, clarity around Indigenous title rights, and price volatility were also top barriers.

BIG PICTURE

A $35,000 Chevy delivers record sales for GM

The EU delays anti-deforestation rules

China’s clean energy efforts keeps climate goals within reach

Columbia’s $40B plan to replace fossil fuel revenues

Rebuilding from Helene without flood insurance

COMMUNITY

🚀 Mission from MaRS: Carbon Credit Purchasing Program Launch Event: Join this kickoff as MaRS brings together corporate leaders and carbon removal innovators to catalyze CDR market adoption. Online, October 16th.

➡️ Discover more climate events.

💡 InBetween Stories: Looking for something new to watch? Check out this new docuseries on climate solutions from Vancouver-based journalist Allison Gacad. It’s a great exploration of some big topics and features many Vancouver-based leaders in the space.

💻️ Orennia is hiring a Lead Data Engineer to build out data and insights to drive capital allocation across the energy transition

➡️ Find more open roles.