OpenAI CEO Sam Altman has publicly refuted claims that AI systems like ChatGPT consume gallons of water per user query, labeling them as "completely untrue" and having "no connection to reality." Speaking at the India AI Impact summit in an interview with The Indian Express, Altman shifted focus to what he acknowledges as the legitimate and growing issue: the massive energy consumption of AI infrastructure.
Altman stated that newer data center facilities are moving away from water-dependent cooling systems altogether. However, he emphasized that the core challenge is the surging electricity demand. He called for a rapid global shift to clean energy sources like nuclear, wind, and solar to power the AI boom. In defending AI's efficiency, Altman made a controversial comparison, arguing that evaluating AI energy use should focus on the cost per query after the initial training phase, likening the training of a model to the 20-year process of raising and educating a human.
This analogy drew criticism from Indian tech billionaire Sridhar Vembu of Zoho, who attended the same summit. Vembu stated, "I do not want to see a world where we equate a piece of technology to a human being," highlighting broader concerns about AI's role in society and potential displacement of human workers.
The scale of the energy problem is underscored by data. A report from the International Monetary Fund (IMF) noted that in 2023, global data center power consumption matched the total electricity usage of entire countries like Germany or France, a surge coinciding with the launch of ChatGPT.
The industry's response to grid limitations is fueling a new wave of off-grid, gas-powered data centers. Major projects are underway, such as the GW Ranch in West Texas, which will cover 8,000 acres and use more electricity than the city of Chicago, primarily from natural gas and solar. Similar large-scale facilities are planned in Wyoming, New Mexico, Pennsylvania, and other states, with backing from companies like Meta, OpenAI, Oracle, and Chevron.
This trend is raising environmental alarms. Energy researcher Michael Thomas warned that reliance on natural gas for these off-grid facilities is "catastrophic for climate goals." The approach has also faced regulatory pushback; the Environmental Protection Agency (EPA) recently ruled that an off-grid xAI data center built by Elon Musk in Memphis, which used portable gas generators, violated emissions regulations.
Local communities are increasingly resisting these projects due to concerns over water usage, increased electricity bills, and environmental impact. For instance, San Marcos, Texas, recently rejected a proposed $1.5 billion data center after public opposition. The strain on power infrastructure is already tangible, with electricity prices rising on the PJM Interconnection, the nation's largest grid.
In a significant policy move, an agreement signed in January by the Trump administration and several state governors now requires tech companies to fund new power generation, with firms committing $15 billion toward new capacity.
