Zerohedge Shares Morgan Stanley Estimate of a 70 Gigawatt US Power Shortfall for AI Data Centers Through 2028
The 70 Gigawatt Hole: Wall Street Maps How Far America's Electric Grid Is Falling Behind AI Demand
Context
If the grid cannot supply enough electricity, new AI data centers will be delayed or forced to build their own power, which limits how fast AI can scale in the US.
Power has become one of the main limits on building AI data centers in the US. The zerohedge article draws on two Wall Street reports: a Goldman Sachs US Power Pipeline report built on Energy Information Administration data, and an estimate by Morgan Stanley analyst Stephen Byrd. The figures below come from zerohedge's account of those reports, which are not public.
Deep dive
Zerohedge (@zerohedge) posted on Nov 1 a link to its article titled The 70 Gigawatt Hole: Wall Street Maps How Far America's Electric Grid Is Falling Behind AI Demand. The post itself only gives the headline, so the details come from the article, which in turn summarizes bank research.
According to zerohedge, the grid had a strong month on paper. It cites Goldman Sachs' utilities team, working from Energy Information Administration data, as saying US generating capacity rose by a net 5.6 gigawatts in September. Zerohedge says that was the strongest September in at least 10 years and almost four times the 1.5 gigawatt historical average.
In the same week, the article says, Morgan Stanley's Stephen Byrd calculated that US data center developers face a power shortfall of 70 gigawatts through 2028 before counting stopgap sources. Those include turbines, fuel cells and converted bitcoin mines. Even after counting them, zerohedge reports, the gap is still 43 gigawatts, or 38% of all the power AI developers need. The link preview quotes Morgan Stanley saying power availability continues to be the most important constraint, and that it is most notable in the US.
The bank reports themselves are not public, so these figures are attributed to zerohedge's summary and were not checked against the originals. The story fits a wider pattern in this deck of AI growth running into physical limits.
What to expect next
Watch for new utility filings, gas turbine orders and grid connection rules that show how much of the shortfall can be closed before 2028. Data center builders are likely to keep turning to onsite generation, fuel cells and power purchase deals, which could raise costs. Regulators and lawmakers may also face pressure to speed up transmission approvals as the gap becomes a limit on AI growth.