MIT Technology’s e-mag, The Spark, cites an International Energy Agency report that global electricity demand is growing by 4% a year. This call for more energy ensures that as electricity demand grows, batteries will boom too. We examine the drivers behind these two trends, and come up with some unexpected answers.
Factors Behind Growing Electricity and Battery Demand
A couple of years ago we might have wondered whether artificial intelligence, and data centers were the main drivers. However, The Spark assures us that 85% of the growth will come from developing and emerging economies in China, India, and Southeast Asia.
The battery manufacturing industry is booming in these regions too, confirming that as electricity demand grows batteries are following suit. China is already in the forefront of these trends, as these remarkable numbers show:
“Approximately 300 terawatt-hours’ worth of electricity was used in China in 2024, just to produce solar modules, batteries, and electric vehicles. That’s as much electricity as Italy uses in a year. And this sector is growing quickly.”
But that’s not all, The Spark continues at MIT Technology. Modern China is enthusiastically adopting electric vehicles and air conditioners, while the rest of Southeast Asia and India are displaying above-average growth too.
Does This Mean That Western Demand Is Flattening Out?
Data center demand may play a lesser role in developing economies. Our demand for electricity has begun flattening out during the past 15 years, thanks to improving efficiencies. Although there is evidence that data centers in the West continue to grown in numbers and size.
However, Western demand for batteries has broken free from raw electricity demand, as renewable energy spreads throughout our economies. The driver this time is the imperative to move rapidly to carbon-free generation.
So the evolving paradigm for the West is changing. It has become less a question of batteries following as electricity demand grows. But more a matter of, as renewable energy expands, so batteries will boom.
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