Do We Have Enough Electricity to Power the Future of Supply Chains?

The future of supply chains will be enabled by Artificial Intelligence, electric trucks, robots, and other technologies. But only if we have enough electricity to power it all, which is a big question mark (and risk) at the moment.

According to research conducted by The American Transportation Research Institute (ATRI), published in December 2022, “Domestic long-haul trucking would use more than 10 percent of the electricity generated in the country today [if they were electric battery trucks] – while an all-electric U.S. vehicle fleet would use more than 40 percent. Some individual states would need to generate as much as 60 percent more electricity than is presently produced.”

(That is one of the reasons why we won’t see electric trucks used for long haul moves anytime soon.)

Meanwhile, as reported by Katherine Blunt and Jennifer Hiller in the Wall Street Journal today, “The AI boom is fueling an insatiable appetite for electricity, which is creating risks to the grid and the transition to cleaner energy sources.” Here’s a couple of excerpts from the article:

It isn’t clear just how much electricity will be required to power an exponential increase in data centers worldwide. But most everyone agreed the data centers needed to advance AI will require so much power they could strain the power grid and stymie the transition to cleaner energy sources.

Former U.S. Energy Secretary Ernest Moniz said the size of new and proposed data centers to power AI has some utilities stumped as to how they are going to bring enough generation capacity online at a time when wind and solar farms are becoming more challenging to build. He said utilities will have to lean more heavily on natural gas, coal and nuclear plants, and perhaps support the construction of new gas plants to help meet spikes in demand.

And don’t forget about bitcoin and other cryptocurrency mining. On February 1, 2024, the U.S. Energy Information Administration issued a press release stating that electricity demand associated with U.S. cryptocurrency mining operations in the United States “has grown very rapidly over the last several years. Our preliminary estimates suggest that annual electricity use from cryptocurrency mining probably represents from 0.6% to 2.3% of U.S. electricity consumption.”

Then add in legislation aimed at replacing gasoline-powered cars and trucks with electric ones over the next decade (see new EPA standards and California’s electric trucks mandate), which will increase demand for electricity; the ongoing push to reduce/replace gas and coal powered electricity plants with renewable sources, which will limit reliable/stable electricity supply; and the increasing threat of cyberattacks against our electrical grid.

What could possibly go wrong?