Artificial Intelligence from Meta boosts energy demand, driving expansion into power trading
Meta Enters Wholesale Power-Trading Business
Meta Platforms Inc., the parent company of Facebook, has taken a significant step towards managing its electricity needs more effectively and powering its operations with clean energy. The tech giant has filed an application with US regulators to enter the wholesale power-trading business.
According to reports, Meta's application to the Federal Energy Regulatory Commission seeks authorization to sell energy, capacity, and ancillary services. The application, filed with a deadline of Nov. 16, does not specify the location for power trading.
Meta's subsidiary, Atem Energy LLC, was formed to act as a power marketer. This move comes as technology companies, including Meta, Microsoft Corp., and Alphabet Inc.'s Google, race to develop advanced artificial intelligence systems, which are resource-intensive.
Big tech companies, including Meta, consume huge amounts of electricity due to their data center operations. In fact, power demand from data centers used to build and run AI models is projected to quadruple in the next 10 years, according to BloombergNEF.
Pavel Molchanov, an analyst at Raymond James, stated that there will be opportunities for tech companies to make extra money by selling electricity into the wholesale markets. Tech companies with contracts for power can sell it back into the wholesale market when prices are high.
Meta's move to enter the wholesale power-trading business indicates a strategy to manage electricity needs more effectively and power operations with clean energy. If successful, this could help the company reduce its carbon footprint and save costs in the long run.
Meta would need to file for membership in one of seven competitive power markets, such as the Texas grid or the Midcontinent Independent System Operator. Amazon.com Inc., Google, and Microsoft are already active power traders, according to filings with US regulators.
Andy DeVries, a utilities and power analyst at CreditSights Inc., mentioned that tech companies with batteries or on-site generators at data centers can sell power back to the grid when prices spike. This strategy could prove beneficial for Meta as it seeks to optimize its energy usage.
Meta's data center in Louisiana will be powered by three natural gas plants, as approved by Louisiana regulators. However, the specific market or location where Meta Energy LLC will operate as a power marketer is not yet clear.
As the demand for clean and sustainable energy continues to grow, it will be interesting to see how Meta's foray into the wholesale power-trading business unfolds. The company's commitment to using clean energy and reducing its carbon footprint is a positive step towards a more sustainable future.
Read also:
- User Data Analysis on Epic Games Store
- Rachel Reeves conducts a discussion with Scott Bessent and financial executives, focusing on investment matters
- Hyundai accelerates production plans: Introducing 7 new N models, aiming for a sales figure of 100,000 units by 2030.
- Yasa, an electric car engine producer, plans to broaden its operations.
