AI economic gains likely to outweigh emissions cost, says IMF

Economic gains from AI will boost global output by around 0.5% a year between 2025 and 2030, outweighing the costs of rising carbon emissions by the data centres needed to run AI models, the IMF said.

Economic gains from artificial intelligence will boost global output by around 0.5% a year between 2025 and 2030, outweighing the costs of rising carbon emissions by the data centres needed to run AI models, the International Monetary Fund said on Tuesday.

An IMF report released at its annual spring meeting in Washington nonetheless noted that those output gains would not be shared equally across the world, and called on policymakers and businesses to minimise costs to broader society.

"Despite challenges related to higher electricity prices and greenhouse gas emissions, the gains to global GDP from AI are likely to outweigh the cost of the additional emissions," it said.

"The social cost of these extra emissions is minor compared with the expected economic gains from AI, yet it still adds to the worrisome buildup of emissions," it said in the report titled "Power Hungry: How AI Will Drive Energy Demand".

Takeup of AI is seen driving a surge in demand for energy-intensive data processing power in coming years, even as the world struggles to keep promises on reducing carbon emissions.

The IMF report noted that the space dedicated to server-filled warehouses in northern Virginia, which has the world's largest concentration of data centres, was already roughly equivalent to the floor space of eight Empire State Buildings.

It estimated that AI-driven global electricity needs could more than triple to around 1,500 terawatt-hours (TWh) by 2030 - about the same as India's current electricity consumption and 1.5 times higher than expected demand from electric vehicles over the same period.