IMF: AI to Boost Global Economy by 0.5% Annually, But Energy Demand Will Soar
The International Monetary Fund (IMF) reckons the economic gains from artificial intelligence (AI) will boost global output by around 0.5% per year between 2025 and 2030.
That’s more than the environmental costs associated with the increased carbon emissions from the energy AI requires, the IMF reckons.
In a report called “Power Hungry: How AI Will Drive Energy Demand” released during its annual spring meeting in Washington, the IMF said the economic gains won’t be felt evenly around the world and urged policymakers and businesses to do more to mitigate the societal costs.
The report says that electricity demand driven by AI could more than triple to around 1,500 terawatt-hours (TWh) by 2030. That’s roughly equivalent to the current electricity demand of India.
The IMF reckons the social cost of that additional demand, in terms of additional emissions, is small compared to the economic gains. However, it says tech firms must live up to their promises to reduce emissions by powering their data centres with renewable energy.
The IMF reckons there’ll be a cumulative increase in greenhouse gas emissions of 1.2% between 2025 and 2030 if current energy policies remain in place. Greener policies could limit that to 1.3 gigatons.
Analysts at the Grantham Research Institute on Climate Change and the Environment say AI could lead to overall carbon emission reductions if it drives faster development of low-carbon technologies.
However, they warn that market forces alone may not push AI applications towards climate action. There needs to be active engagement from governments, tech companies and energy firms to ensure AI is used intentionally and sustainably.
