(Bloomberg) -- Artificial intelligence is poised to help drive a 900% jump in power demand from data centers in the Chicago area, according to Exelon Corp. Chief Executive Officer Calvin Butler. 

About 25 data center projects that would consume around 5 gigawatts of power total — roughly equivalent to the output of five nuclear plants — are undergoing engineering studies in Exelon unit Commonwealth Edison Co.’s territory, Butler said. That compares with about 400 megawatts of data center demand currently on its system. Butler expects up to 80% of the planned developments to be completed.

“We are seeing quite a bit of activity,” Butler said during an interview on the sidelines of the S&P Global Power Markets Conference in Las Vegas on Wednesday. Data center developers are attracted to ComEd’s low electricity rates, carbon-free generation from nuclear reactors and state tax incentives, he added. An Exelon spokesperson said the company will continue to ensure that its system can handle the additional power load growth.

Read more: AI Needs So Much Power That Old Coal Plants Are Sticking Around

The demand surge wouldn’t be met immediately by more power generation. New data centers would initially be served by excess capacity already on the regional grid, imported electricity from other areas and then eventually by newly constructed sources, said Paul Patterson, a utility analyst for Glenrock Associates LLC.

“You have the ability to move power around. It’s not like Chicago is some island — you can import electricity,” Patterson said.

Electric utilities and regulators are facing the biggest demand jump in a generation. Along with data centers to run AI computing, America’s grid is being tested by new factories and the electrification of everything from vehicles to heat pumps.

Read more: Exelon CEO Warns Cleaning the Grid Needs Higher Power Bills 

Power availability is increasingly a constraint on data center development, according to real estate services firm Cushman & Wakefield, which designated Chicago as a key US market behind more established hubs like Virginia’s Data Center Alley, Atlanta and Dallas. 




©2024 Bloomberg L.P.