Generac Power Systems CEO Aaron Jagdfeld, whose company's products serve as a solution to challenges facing the American power grid, added another big challenge to the list — a recent study that determined searching for information via OpenAI ChatGPT uses 17 times more energy than a Google search.
That’s potentially good news in terms of generating more demand for products from Genesee Depot-based Generac (NYSE: GNRC), including the company’s standby generators for homes and businesses. But the emergence of artificial intelligence adds to the growing demands on the power grid at a time when power sources are transitioning to solar and wind from coal and natural gas.
“The AI boom has really caught everybody flat-footed – all the utilities, the grid operators – in terms of the forecast (for power-grid demand),” Jagdfeld said April 12 on Fox Business News show “The Claman Countdown” with Liz Claman. “Because the forecast continues to change very rapidly. And this is a huge amount of demand that’s going to come on the grid and the grid is already struggling.”
The proliferation of artificial intelligence for businesses and communities will require construction of new data centers to meet the demand for power, Jagdfeld said.
“The amount of power that’s going to be consumed by data centers in five years time is going to be triple where it is today,” he said. “It’s the equivalent of adding 40 million U.S. households to the grid in five years time.”
While the growth in demand for electric vehicles is one driver, AI systems like ChatGPT serve as a newly emerging example, Jagdfeld said. The energy intensity of searching via ChatGPT includes a request going “off into the cloud” and returning to an individual's or company's computer, Jagdfeld said.
“A single ChatGPT request takes 17 times more energy than a Google search,” he said.
The study Jagdfeld cited appeared in the February issue of the International Journal on Language Computing, a company spokesman said.
The study was conducted by a team from the University of Siena in Italy and expert.ai, which describes itself as an “AI company committed to solving complex language solutions.” The study compared traditional approaches for searching information with more recent approaches such as generative models like GPT.
The search was conducted on data sets from the European Court of Human Rights. One of the models found generative models like ChatGPT used 16.52 times the energy of traditional approaches.
The researchers said their goal was to analyze the performance of AI solutions in terms of costs, energy consumption and carbon footprint impact in a real-world business context.
“We firmly believe that such analysis is vital when evaluation AI solutions, given the worrying trend towards ever-larger models requiring energy-intensive computations,” the researchers said.
During Jagdfeld’s appearance on Fox Business News, he only briefly mentioned his company’s products as providing peace of mind to businesses and homeowners concerned about the reliability of the power grid.
Growing concerns about the power grid’s reliability, which also is impacted by storms and fires, has been a major selling point for Generac standby generators for a number of years, he acknowledged.
Host Claman also noted Generac’s growth via acquisitions of ecobee smart thermostats in 2021 and EV-charger company Wallbox in 2023.
Jagdfeld said Generac is expanding further into energy technology as it extends its reach beyond its traditional generator business.
