PARIS— As artificial intelligence transforms industries at breakneck speed, its growing influence on global energy systems is drawing intense scrutiny. To address this fast-developing intersection, the International Energy Agency (IEA) has launched a groundbreaking new initiative: the Energy and AI Observatory.
Announced by IEA Executive Director Fatih Birol, the platform provides real-time insights into how AI is driving both skyrocketing electricity demand from data centres and unprecedented efficiencies in the energy sector itself. The Observatory aims to become the central hub for data, analysis, and case studies to inform global decision-makers navigating this double-edged disruption.
“The IEA is at the forefront of efforts to understand and manage the significant links between energy and artificial intelligence, which is quickly emerging as one of the most important technologies of our time,” Dr. Birol said.
A Platform for Global Visibility and Action
The Observatory, the first of its kind, includes a suite of interactive tools that allow users to visualise electricity consumption trends by region, as well as infrastructure growth in the digital sector. By making these datasets more accessible, the IEA hopes to support a wider range of stakeholders, from governments and utilities to researchers and tech companies.
In addition to raw data, the Observatory features 20 global case studies selected from a public call for submissions. These real-world examples highlight how AI is already helping schools, factories, and campuses reduce energy use, improve system efficiency, and slash emissions.
The platform was formally introduced following the release of the IEA’s landmark April 2025 special report, Energy and AI, which offered the most comprehensive global analysis of the topic to date. The report’s headline finding: electricity demand from AI-optimised data centres is expected to more than quadruple by 2030.
AI as a Driver of Demand and Efficiency
While AI is seen as a major contributor to rising power consumption, especially from data centres, the IEA’s research also finds that it has the potential to be a powerful tool for efficiency and sustainability.
From optimising grids to managing building temperatures, AI is already unlocking major opportunities. For example, schools in Stockholm and a university campus in Pune, India, are cutting energy use by deploying AI in heating and cooling systems. Steel and cement plants in Czechia, Spain, and the United States are leveraging AI to increase the efficiency of gas consumption and waste heat recovery.
The dual role of AI as both a power consumer and a power optimizer places it at the centre of energy policy debates. The Observatory is expected to become a critical tool in shaping national and international responses, offering trusted data in an era of rapid transformation.
Launched on the Global Stage
The IEA’s commitment to tracking the energy-AI connection was first made public by Dr. Birol in February 2025, during the AI Action Summit hosted by French President Emmanuel Macron and Indian Prime Minister Narendra Modi. The Observatory will also contribute to high-level energy dialogues organised by Canada’s G7 Presidency.
“Reliable data and analysis are the cornerstone of navigating this fast-moving space,” Birol emphasised. “Building on our recent major report on this subject, this new Energy and AI Observatory, developed in consultation with a wide range of partners, underscores our commitment to supporting decision makers around the world as they plan for the future.”
The Observatory is part of a broader initiative by the IEA to explore digital innovation in energy. In December 2024, the agency hosted the Global Conference on Energy and AI, the largest conference ever held on the topic, bringing together experts from across industries to share insights and policy ideas.
Shaping the Future of Energy and AI
With AI’s role in the energy system expanding rapidly, the IEA’s Observatory comes at a crucial moment. By offering high-quality, up-to-date information, it gives policymakers, industry leaders, and innovators the tools they need to plan responsibly, kerb emissions, and manage demand growth.
As the world leans further into digital transformation, platforms like the IEA Energy and AI Observatory will likely prove essential to balancing innovation with sustainability, ensuring that AI enhances, rather than overwhelms, the global energy system.
