Power Consumption for Data Centers Worldwide

Updated January 2020

The chart shows projections for data center power consumption. Although the workload will increase significantly, Solomon estimates power consumption will grow at a slower rate because of the switch to hyperscale data centers. Such a shift can improve power usage effectiveness. However, this forecast faces significant uncertainties due to cryptocurrency mining trends, the speed of the shift toward hyperscale centers, and the use of new server and infrastructure technologies.

Data centers are used for the remote storage, processing, or distribution of large amounts of data. Data centers require significant amounts of electric power to operate. The information and communication technology sector will use 20% of all the world’s electricity by 2025 and emit up to 5.5% of all carbon emissions.* During 2019, data centers alone consumed 2% of electricity worldwide and are responsible for 0.3% of global carbon emission. The percentage of electricity consumed by data centers could rise to 8% by 2030. Large data centers over 1,000,000 square feet (ft2) in size can continuously consume over 100 megawatts (MW) of power.

* Adams, W. Nov 2018. Power consumption in data centers is a global problem. Available at https://www.datacenterdynamics.com/opinions/power-consumption-data-centers-global-problem/

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Data Center Workload Forecast

Updated January 2020

The chart shows the forecast growth of data center workloads based on information from the International Energy Agency and Solomon estimates.

Invest Alberta advertises data centers as one of the province’s business investment opportunities. Both Alberta and British Columbia could become preferred locations for the construction of data centers for a number of reasons:

  • Power for data centers can be generated using cheap natural gas close to data centers, which can reduce power transmission losses. For example, China’s largest data centers, China Telecom’s Information Park and Hohhot Data Centers, are located in Inner Mongolia close to sources of both hydroelectric and thermal energy. With a total capital cost of 3B USD, Information Park is 10.7 million ft2 in size and capable of consuming 150 MW of power.6 The Hohhot Data Center has a total capital cost of approximately 2B USD and power consumption capacity of 115 MW.
  • The construction of large data centers creates additional opportunities to monetize Western Canadian natural gas. For example, a group of large data centers that consumes 300 MW of power would require 60 million cubic feet per day (MMcf/d) of natural gas to fuel operations. Locating data centers near supply sources in the Montney could reduce pipeline tolls, thereby decreasing overall energy cost. Potential also exists in Western Canada to use co-generation power from steam-assisted gravity drainage or chemical processing operations to fuel data centers.
  • The ambient temperature and cold water available in a cooler climate can reduce overall data center cooling costs (especially in northern areas such as Grande Prairie, Fort St. John, and Fort McMurray).
  • Alberta recently completed major transmission system upgrades that provide a stable electricity grid for redundant power and a ready market for excess generation. Western Canada also offers a robust high-speed telecommunication network.
  • The strength of the US dollar relative to the Canadian dollar, together with a number of government incentives, creates additional opportunities for technology companies to establish data centers in Western Canada.
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Breakdown for Different Power Generation Sources in 2020 and 2030

Updated January 2020

The charts show the breakdown for different power generation technologies in 2020 and 2030. In 2020, most power will be generated by coal power plants (27.4%) primarily in China, India, and other emerging electric markets. While the market share of coal power plants will decline to 20.3% in 2030, total coal power generation capacity will increase 2% to 2,140 GW as coal power plants are still being constructed in some countries, particularly China, due to the lower cost of coal versus other fuel sources.

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Power Generation by Clean and Fossil Fuel Technologies

Updated January 2020

The chart shows the growth of power generation utilizing clean and fossil fuel technologies. The market share of power generation plants that use clean technologies, which do not emit carbon dioxide and include solar, wind, hydro, nuclear, biomass, and geothermal, will grow from 42.6% in 2020 to 47.9% in 2030. Total power generation capacity worldwide will reach 10,550 GW in 2030, up from 7,680 GW in 2020. By comparison, total thermal power generation capacity, which includes oil, gas, and coal-fired plants, will grow by 24.7% from 4,400 GW in 2020 to 5,500 GW in 2030, primarily due to gas power generation. The remainder of the growth in power generation capacity will come from power plants that use clean energy resources, or 5,050 GW.

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Growth of Nuclear Power Generation Capacity Worldwide

Updated January 2020

The chart shows the projected growth of nuclear power generation capacity worldwide through 2030. Around 450 nuclear power generation units—with capacity slightly above 400 gigawatts (GW)—currently are operating in 30 countries. These plants comprise around 5.3% of total power generation capacity worldwide but only produce around 10% of the world’s electricity. The United States is home to the largest number of reactors in operation with 97, followed by France with 58, and China with 47.

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New Nuclear Power Generation Capacity Under Construction Worldwide

Updated January 2020

Over 100 nuclear reactors are under construction or in different stages of planning worldwide. Around 50 new units are currently under construction. The chart shows new nuclear power generation capacity under construction worldwide until 2026.

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New Nuclear Power Generation Capacity Under Construction Per Country

Updated January 2020

The chart shows new nuclear power generation capacity under construction per country. China currently is building 12 units with total capacity 11.2 GW, followed by South Korea and the United Arab Emirates with 5.6 GW each.

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North American Natural Gas Demand per Sector

Updated October 2019

The chart shows the North American natural gas demand.

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Change in North American Demand by Sector 2018–2030

Updated October 2019

The chart illustrates the change in North American demand by individual sector during the 2018–2030 period.

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Eastern Triangle Natural Gas Demand to 2030

Updated August 2019

The chart shows overall Eastern Triangle demand growth from 2019–2030.

Eastern Triangle markets include Ontario, Quebec, and US Pipeline Exports to New York and New England markets.

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Eastern Triangle Power Demand to 2030

Updated August 2019

The chart shows overall power demand growth for the Eastern Triangle market.

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Eastern Triangle Demand Composition

Updated August 2019

The chart shows the demand composition of the Eastern Triangle Market from 2005–2030.

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US Northeast Demand to 2030

Updated August 2019

The chart shows the US Northeast has a below average annual growth compared with the North American average growth rate.

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North American Regional Power Generation

Updated May 2019

  • North America comprises the US (divided into six power regions) plus Canada total.
  • Market growth is occurring in every region with higher growth seen primarily in largest generating regions (Interior West is an exception).
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Canadian Power Generation Outlook

Updated May 2019

  • Power is a growth market for natural gas in Canada and US.
  • Ontario became the first jurisdiction in North America to eliminate coal-fired generation from mix (April 2014).
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Canadian Regional Power Generation

Updated May 2019

  • Canada has an abundance of power generated from hydroelectric when compared to the US and Mexico.
  • Provinces generally rely on their local resource capabilities:
    • Hydroelectric in BC, Manitoba, Quebec, Newfoundland, and Ontario (to some degree).
    • Coal in Alberta/Saskatchewan.
    • Nuclear in Ontario.
  • Hydro Quebec is focused on renewable and hydro sources.
  • Ontario is the first jurisdiction in North America to eliminate coal-fired generation—the Thunder Bay Generating Station burned its last supply of coal in April 2014—being converted to Biomass.
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Coal-to-Gas Switching Curve

Updated May 2019

There are two main drivers behind coal-to-gas switching: (1) longer-term displacement due to environmental regulation and (2) shorter-term switching due to the relative costs of each of the competing fuels.

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North American Industrial Demand by Sector

Updated May 2019

The chart shows Solomon’s forecast for industrial natural gas consumption by sector and region.

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North American Power Generation Outlook

Updated May 2019

The chart shows North American power generation by fuel type.

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Appalachia Demand

Updated May 2019

The figure presents Appalachian demand* for natural gas to 2030.

*Solomon Appalachian demand includes the Northeast region with the addition of Ohio, West Virginia, Maryland, Delaware, and Virginia.

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Potential for Alberta Power Projects

Updated May 2019

  • Green line illustrates gas demand required from gas-fired generation to offset Environment Canada performance standard closing coal plants after 45-year economic life.
  • Green Dot illustrates the overall gas demand required from gas-fired generation to offset both the Environment Canada and Alberta Government coal policy to close plants by 2030.
  • Red area shows coal-fired capacity meeting 45-year life by 2030.
  • Blue area shows remaining coal-fired capacity, which would be neutered before its economic life by Alberta Government coal closures.
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Ontario Gas-Fired Generation

Updated May 2019

  • Ontario replaced much of the coal capacity that was phased out in 2014 with natural gas.
  • Four coal fired plants were decommissioned.
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Power Generation Cost Coal vs Gas

Updated May 2019

The chart shows a coal-to-gas parity calculation for various radius distances around CAPP and PRB basins and a gas floor range for switching from coal. Solomon Strategic Energy Advisors compared delivered fuel cost for combined cycle gas turbine (CCGT) and coal plants for the Central Appalachia (CAPP) and Powder River basins (PRB).

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North American Retiring Coal-Fired Capacity

Updated May 2019

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Location of Nuclear Power Plants

Updated May 2019

  • Currently 104 nuclear power reactors in the US.
  • Virtually all of the nuclear power plant sites are close to major gas pipelines.
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Hydro Generation (TWh)

Updated May 2019

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Power Generation Capacity Factors by Type

Updated May 2019

This chart shows the capital cost requirements and lead time for various types of generic utility-scale generation facilities.

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Industrial Gas Demand Growth – Direct Reduced Iron (DRI)

Updated May 2019

  • Cheap Shale Gas impacts investments into direct reduced iron plants, a main steel ingredient.
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North American Industrial Gas Demand

Updated May 2019

  • Chart shows North American industrial gas demand. Solomon Strategic Energy Advisory includes gas demand for Oil Sands and LNG exports in its industrial gas demand forecast.
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Gas-to-Methanol Economics

Updated May 2019

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Gas-to-Liquids (GTL) Plants

Updated May 2019

  • GTL derives products competing with crude oil (diesel, naptha, distillate, lubes, waxes).
  • Operating plants: PetroSA in Mosel Bay, South Africa and Shell in Bintulu, Malaysia.
  • Sasol Chevron, a joint venture between Chevron & Sasol (South African chemical & fuels company and pioneer of coal-to-liquids and GTL technology) are building plants in Qatar (almost onstream) and Nigeria (2008/9).
  • Exxon Mobil and Shell in agreements with Qatar have operating plants in Qatar. Qatar wants to be the GTL capital of the world.
  • Other plants being considered in Canada Alaska, South America, Australia, and East Indies although expect most of the activity to occur in the Middle East with Qatar leading the way.
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Gas-to-Liquids Economics

Updated May 2019

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Natural Gas Demand for Vehicles

Updated May 2019

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LNG Trucks: Is it Worth it?

Updated May 2019

The chart shows a comparison of capital costs and fuel savings between diesel and LNG trucks. When natural gas is converted to LNG by chilling to -260 degrees Fahrenheit (-160 °C), its energy density increases to the point where it requires only 50 percent more volume to match the energy content of diesel fuel.

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North American Natural Gas Transport Outlook

Updated May 2019

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Western Canadian Gas Demand Outlook

Updated May 2019

  • Western Canada gas demand will continue to grow, primarily in Alberta, due to growth in Oil Sands development & gas-fired power generation, making Alberta Canada’s largest natural gas consuming province.
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Canadian Gas Demand Outlook

Updated May 2019

The chart shows a breakdown of regional Canadian gas demand.

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North American Gas Demand by Region

Updated May 2019

The chart shows a detailed illustration of North American natural gas demand by region (excludes exports to Mexico).

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International Gas Intensive Demand

Updated May 2019

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Canadian Gas Supply-Demand Allocations

Updated December 2017

This chart illustrates the allocation of Canadian gas supplies and Central Canadian imports to their traditional gas markets through 2025 at Canadian border points. Continued growth of demand in Western Canada, combined with competition from low-cost US Lower 48 gas, leads to limited growth options for Canadian supply. As TransCanada Long-Term Fixed Price (LTFP) comes into service and Marcellus/Utica plays continue to develop and push into the Chicago-Dawn markets, Solomon believes that the Ontario-Quebec market will provide transition opportunities to export into the upstate New York and New England markets on existing facilities. Western Canada gas supply will benefit from pipeline expansions utilizing reasonable cost compression options on Alliance and GTN allowing low-cost production to be moved into the North American pipeline grid.

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Cost of New Demand

Updated December 2017

This chart provides the cost of new demand for gas-fired power, methanol, oil sands, ammonia, gas-to-liquids (GTL), and ethylene/polyethylene.

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North American Residential Outlook

Updated December 2017

This figure provides Solomon Strategic Energy Advisory's outlook for the residential sector.

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North American Commercial Outlook

Updated December 2017

This chart shows North American Commercial Outlook. While commercial consumers are making efficiency gains, there is negligible difference in the average consumption per commercial user. Commercial units (blue line) cover a wide spectrum such as hospitals, restaurants, warehouses, public service establishments, and office buildings. Although the commercial customer count has stagnated since the 2008–2009 recession, Solomon believes that as economic growth recovers, so will commercial count (growing at 0.5% per year). Consumption (thousands of cubic feet per customer per heating degree day (Mcf/customer/HDD)) (red line) has lagged behind improvements seen in the Residential sector, and Solomon believes this trend will continue during the forecast period. As commercial consumption comes from more heterogeneous consumers, aligning economic incentives to increase building energy efficiency is difficult. For example, a landlord may not be incented to spend capital to decrease energy costs if the tenant is responsible for utility costs.

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New Generation Assumptions

Updated December 2017

This chart shows the capital cost requirements and lead time for various types of generic utility-scale generation facilities. On a combined basis, natural-gas-fired generation has a clear capital cost and lead time advantage over all other forms of generation. Solomon also expects lower variable costs when compared to the past decade.

  • Decreasing costs for wind and solar photovoltaic (PV) generation now have these technologies competing favorably with new coal-fired generation and other forms of renewable generation. This has led to rapid growth in both wind and solar PV capacity additions.
  • Increasing costs for capital-intensive projects and concerns over CO2, NOX, SOX, and other environmental restrictions have discouraged construction of new coal plants, a trend that is expected to continue.
  • Nuclear generation has both high capital costs and long lead times of 6 years or more. Due to strong public sector involvement and extensive regulatory oversight, there is a high risk of project cost overruns and delayed commissioning.
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