British Columbia’s AI Boom Faces Power Supply Challenges

The burgeoning artificial intelligence (AI) sector in British Columbia is witnessing rapid growth, but this expansion brings significant challenges regarding electricity supply. As AI technology becomes increasingly integrated into everyday life, the demand for data centres is rising sharply. With the province’s renewable energy sources under pressure, balancing economic development and energy sustainability has become a pressing issue.

AI’s applications range from enhancing Netflix recommendations to enabling facial recognition on smartphones. In British Columbia, two AI data centres recently opened in Prince George and Kamloops, with more anticipated. Rick Glumac, the Minister of State for Artificial Intelligence and New Technologies, emphasized the transformative impact of AI, stating, “AI is everywhere. It’s changing how we work. It’s changing how we learn. It’s changing how we do business.” As the province aims to boost its AI sector, it faces a crucial question: can it meet the energy demands of this emerging industry?

The electricity supply in British Columbia, which relies heavily on hydroelectric power, is limited. AI data centres are particularly energy-intensive, often requiring over 100 megawatts each. For comparison, conventional data centres in the province currently seek a combined 40 megawatts, a fraction of the total 12,000 megawatts available. This puts AI data centres in direct competition with other sectors, including electric vehicle transition and liquefied natural gas (LNG) expansion.

The Canadian federal government has also taken steps to support AI growth, establishing a Minister of Artificial Intelligence and Digital Innovation, Evan Solomon, in response to the recent election. In October, Canada launched an AI Strategy Task Force to solicit public input on infrastructure and security, emphasizing the importance of digital sovereignty.

B.C. has now created a cabinet position dedicated to AI, making it the first province in Canada to do so. Glumac noted that this focus allows for collaboration with the federal government on national security concerns related to data ownership. The B.C. Ministry of Energy and Climate Solutions classifies data centres into three categories: conventional, cryptocurrency mining, and AI. Currently, there are 12 notable conventional data centres in the province, with three more seeking power connections.

Telecommunications giants are eyeing B.C. for AI data centre investments. In May, Bell Canada announced plans for an AI “data centre supercluster” expected to consume upwards of 500 megawatts, accounting for about five percent of B.C.’s power supply. The company has already opened a seven-megawatt AI facility in Kamloops and plans further expansions. Meanwhile, Telus has committed to establishing a fully owned AI data centre in the province, emphasizing its operations will be powered by 99 percent renewable energy, although specific power consumption details remain undisclosed.

Glumac indicated that BC Hydro is closely monitoring the energy demands from these operations. The province has previously imposed a moratorium on new cryptocurrency mining connections due to the excessive energy required. In December 2022, it halted requests for additional cryptocurrency operations, which sought over 1,400 megawatts of power. Glumac asserted the need for regulation to ensure that clean energy supports both data centres and local communities.

As the AI industry evolves, the need for a balanced approach to energy supply becomes crucial. Iren, B.C.’s largest bitcoin miner, has begun diversifying into AI data storage, highlighting its commitment to environmentally sustainable practices while adapting to new market demands. The company plans to double its AI storage capacity and expand its workforce, further demonstrating the intertwining of AI and energy needs.

Experts urge provincial governments to proactively plan for the anticipated surge in energy demand linked to AI data centres. Kate Harland, the research lead for clean growth at the Canadian Climate Institute, emphasized the importance of creating policies now to avoid future challenges. She noted that while AI has the potential to drive efficiencies, it also poses significant demands on the power grid.

In summary, British Columbia stands at a crossroads, where the promise of AI must be balanced against the realities of energy supply. As the province navigates this landscape, the decisions made today will impact the sustainability of its economy and environment for years to come.