AI industry set to use as much energy as countries like Sweden or the Netherlands, study finds

• The AI industry is projected to require as much energy as a small country, a study has found.
• By 2027, the energy required by the sector could spike to match countries the size of Sweden.

Concerns about the AI industry's environmental impact have been bubbling under the surface for some time.

Tech companies have been scrambling to produce AI-powered products at pace amid a boom of investor interest, bolstering their own AI capacities to do so.

However, the tech comes with a huge carbon footprint, and the rapid acceleration of development could see the industry's energy consumption spike to match levels produced by an entire country in just a few years.

That's according to a new study from Alex de Vries, a PhD candidate at the VU Amsterdam School of Business and Economics.

"Given the expected production in the coming few years, by 2027 newly manufactured AI devices will be responsible for as much electricity consumption as my home country, the Netherlands," de Vries told Insider. "This is also in the same range as the electricity consumption of countries like Sweden or Argentina."

The combination of training large AI models and making them generate content in response to live queries "makes AI relatively energy intensive if you compare it to a standard Google search," he said.

"AI is just very energy intensive," he added. "Every single of these AI servers can already consume as much power as more than a dozen UK households combined. So the numbers add up really quickly."

The study analyses the supply chain of AI devices, especially chipmaker Nvidia, which dominates around 95% of the market for AI chips. De Vries acknowledges publically accessible information around this is still quite limited as tech companies don't disclose enough data.

"A lot of things are still unknown," he said. "So we don't really know where those machines are going to end up and that's going to matter a lot for a range of questions that you might have with regard to AI sustainability."

Mitigation will require more transparency from tech companies, he said, as well as establishing a more mindful approach towards AI development as a whole.

"Everyone should be pretty mindful about whether or not they really need to be trying to put AI into their applications," he added, "it's not a miracle cure for everything."