AI Exchanges: Where Will the Power Come From?

Welcome to Goldman Sachs Exchanges. I'm Allison Nathan, and I'm here with George Lee, the co head of our Goldman Sachs Global Institute. Together, we're cohosting a series of episodes exploring the rise of AI and everything it could mean for companies, investors, and economies. George, good to see you again. Great

to be here, Austin.

George, I'm very excited for this conversation, because today, we're going to discuss one of the biggest questions about the rise of AI. Where will the power come from? We know that it consumes enormous amounts of power. That's come up in a lot of our conversations. And in the first episode of the series, I think you said it may be one of the biggest constraints to the growth and development of AI. So let's dig deeper into that. Tell us why that is. There's

a temptation to think about AI as the sort of ephemeral phenomenon, the great chatbot in the sky. The reality is this is one of the most physical, technology infrastructures ever built. Vast data centers filled with racks of servers and GPUs and other other gear. All of that gear requires enormous amount of power and at a scale and density that probably has never been seen in the history of computation before. That coming at the same time of a as a bunch of other emergent power needs in the world has really made power kind of perhaps the most binding constraint or bottleneck on the delivery of

So let's bring Rebecca into the conversation. Rebecca is a partner in our natural resources group within our investment banking division, which just published a report entitled Powering the AI Era. Rebecca, welcome. Thank

you. Thrilled to be here.

So, Rebecca, in your job, you are talking to, leaders in this space, corporate leaders in this space all the time. How is AI dominating those conversations, at this point?

It's been top of the list. To say that AI and the associate power demand has been a focus for our clients is a true understatement. And by the way, the CEOs and the boards of our biggest power companies, they will tell you both privately and publicly the power demand that they're seeing is unprecedented, and there's no playbook for this. But to understand why that is, because it seems pretty simple. Right? AI data centers are getting built. Let's just build some power plants. It's actually not that simple. There's a lot that's going into it. So just to lay this like, set the table for a sec on

the camel's back, because