Data center energy demand is projected to surge nearly 300% by 2035, according to a new report from BloombergNEF. The sector’s electricity consumption is expected to climb from 40 gigawatts today to 106 gigawatts by the end of the decade, driven by an unprecedented wave of new infrastructure development. The growth is fueled by the expanding needs of artificial intelligence, particularly large-scale AI training and inference workloads. As AI adoption accelerates, data centers are evolving into massive facilities, with average new projects consuming well over 100 megawatts—more than double the typical capacity of existing centers. Nearly a quarter of planned facilities will exceed 500 megawatts, and several are expected to surpass 1 gigawatt. This shift toward larger, more power-intensive sites is reshaping where data centers are built. With urban locations becoming scarce and constrained by space and zoning, new developments are increasingly concentrated in rural areas across Virginia, Pennsylvania, Ohio, Illinois, New Jersey, and Texas’s ERCOT grid region. The report marks a significant upward revision from BloombergNEF’s earlier forecast in April, reflecting a surge in announced projects. Early-stage developments have more than doubled between early 2024 and early 2025, even though these are not yet committed or under construction. The long lead times—averaging seven years—mean that current planning decisions will heavily influence future energy demand. The rapid expansion has raised concerns about grid reliability. The PJM Interconnection, which manages the power grid across 13 states and the District of Columbia, is under scrutiny from its independent monitor, Monitoring Analytics. The group has filed a complaint with the Federal Energy Regulatory Commission (FERC), arguing that PJM must enforce its authority to delay new data center connections until the grid can support them reliably. Monitoring Analytics warns that unmanaged growth could strain the system, contribute to higher electricity prices, and undermine long-term grid stability. “PJM has the authority to require large new data center loads to wait until the system can serve them reliably,” the group stated. It also urged the creation of a formal load queue to manage demand. The scale of investment underscores the urgency: global spending on data center infrastructure reached $580 billion in 2024—surpassing annual global spending on oil exploration and production. As AI continues to drive demand, the race to build and power these facilities is reshaping energy markets, regulatory frameworks, and regional economies.