Commitments by large AI companies to limit emissions of greenhouse gases are at risk as those companies pursue a massive build-out of data centers, many of which will be powered by fossil fuels in the near term and possibly beyond.
What’s new: Alphabet, Amazon, Meta, and Microsoft have begun to acknowledge that keeping up with projected demand for AI is interfering with earlier plans to stop raising the concentration of greenhouse gases to the atmosphere, Associated Press reported. (Disclaimer: Andrew Ng is a member of Amazon’s board of directors.)
How it works: Electricity consumed by top tech companies has increased significantly over the last few years, and with it their emissions of greenhouse gases that contribute to climate change, despite ongoing efforts to reduce emissions. While they have emphasized clean sources of energy including wind, solar, geothermal, and nuclear, lately they have begun to develop natural gas power plants to meet rapidly rising demand for AI.
- In Alphabet’s most recent Environmental Report, the company characterized its net-zero 2030 goal — which it set forth in 2024, after it had abandoned an earlier pledge to maintain carbon-neutral operations — as a “moonshot.” Recent reports indicate that the company’s data center in North Texas will be powered partially by natural-gas plants. Alphabet has invested in next-generation geothermal and nuclear sources, but they’re not yet deployed at sufficient scale. Although 66 percent of the energy for its data centers and offices came from carbon-free sources in 2024 — and its emissions per unit of computation have diminished dramatically — its total greenhouse-gas emissions increased by 54 percent between 2019 and 2024.
- In Amazon’s most recent Sustainability Report, the company said that one of the biggest challenges of scaling AI is increased energy demand. The company has invested in natural-gas plants in Mississippi and Indiana to meet the energy demands of nearby data centers. It views nuclear energy as a key part of its strategy to become carbon-neutral, but the planned nuclear sources won’t come online until the 2030s. Meanwhile, Amazon’s total carbon emissions have increased by 33 percent since 2019.
- Meta’s most recent sustainability report emphasized that the path to net zero depends on new technology, suppliers, and collaboration with global coalitions. The company is building private gas-powered plants to generate energy for data centers including its largest-yet, 5-gigawatt facility in rural Louisiana. It has invested in projects that could support up to 6.6 gigawatts of new and existing clean energy by 2035 including geothermal, nuclear, and energy storage to take better advantage of wind and solar power. The company’s total emissions increased by over 60 percent between 2020 and 2024, while its electricity consumption by data centers nearly tripled.
- While Microsoft’s previous sustainability reports emphasized progress toward eliminating more greenhouse gases than it emits by 2030, the most recent edition described this goal as a “marathon, not a sprint.” Microsoft recently signed an agreement with Chevron to build a natural-gas power plant even after it inked a 20-year purchase agreement to restart the nuclear reactors at New York’s Three Mile Island in, which are expected to come online in 2027. Since 2020, Microsoft’s total emissions have increased by 23 percent and its electricity consumption has more than doubled.
Behind the news: In the years following the 2015 Paris Climate Agreement, which commits governments to limiting global warming by 2 degrees Celsius above pre-industrial levels, many companies signed corporate pledges to meet goals intended to slow climate change. For instance, over 600 companies signed The Climate Pledge co-founded by Amazon and Global Optimism in 2019, which commits companies to reaching net-zero emissions of greenhouse gases by 2040. The Science-Based Targets initiative, which launched in 2015, is another corporate agreement that requires companies to set climate targets that align with the Paris Agreement. The top AI companies have embraced these principles and publish annual reports that document efforts to meet their commitments.
Why it matters: In 2024, data centers accounted for roughly 1.5 percent of electricity consumption globally and 4.4 percent in the U.S. The U.S. figure is projected to rise to as much as 12 percent within the next few years. While big AI companies thought they would have sufficient energy from clean sources, the recent sharp rise in demand is pushing them toward further reliance on fossil fuels that produce climate-changing greenhouse gases.
We’re thinking: Top AI companies have invested meaningfully in renewable energy like wind and solar and next-generation sources like nuclear and geothermal power. However, these sources still face scaling problems, which is why companies have turned to natural gas plants to meet growing energy demands. That’s a worrisome trend. However, for the amount of work that they do, well run data centers are still the most efficient option, and we hope that further efficiency gains in AI will balance rising emissions.