The Future of Data and Energy Transmission 2050

Power and data networks are turning into one system, and electricity, not bandwidth, now limits growth. AI data centres need gigawatts that grids cannot connect quickly, so compute moves to wherever power can be found and fibre carries the results back. The winners will be those who control the slowest assets to build: grid connections, converter sites, factories, ships and rights of way.

Power, not money, is the main limit today. Grid connections, power transformers, high-voltage cable factory slots and cable repair ships are all in short supply, while the four biggest cloud builders plan to spend about $720bn to $740bn in 2026. So compute is moving to wherever power can be found. In the US, big new loads connect on flexible terms: data centres bring their own power and accept being cut off in an emergency.

We expect data centres to use 850 to 1,050 TWh of electricity in 2030 (65 to 75% likely), up from about 415 TWh in 2024 on IEA figures. By 2050 we expect 2,500 to 4,500 TWh, or 5 to 9% of world electricity demand (40 to 50% likely).

The world spends about $550bn a year on grids, and we expect $650bn to $850bn a year by 2035. China alone plans more than RMB 5 trillion of grid investment for 2026 to 2030, and India is building one of the world's largest transmission programmes.

The likely winners are practical, not glamorous: UHV and HVDC lines that move bulk power long distances, higher-capacity wire on old towers, dynamic line rating, grid-forming inverters, co-packaged optics and optical chip links in AI systems, and satellite networks linked by lasers. Each is already made in factories and has big buyers paying for it.

HVDC (high-voltage direct current) lines move large amounts of power over long distances with low losses. They are already mainstream in China, which plans about 15 new UHV DC channels by 2030. We rate UHV and HVDC corridors at over 90% likely to be mainstream by 2035 and over 95% by 2050.

The biggest threat is the cable being designed out, not a better cable. Inside AI racks, circuit boards, light inside the chip package and 800-volt power are replacing copper cables. Over long distances, AI campuses with their own power plants, satellites that talk straight to phones and data centres beside wind farms bypass new lines.

China funds the whole chain and plans power and data together from the centre. It files most patents in HVDC, superconducting cable, subsea repeaters and quantum communication, sets world prices for fibre and already leads in the optical modules that AI data centres buy. Its share is lowest in power beaming and in co-packaged optics and silicon photonics.

The case against us is serious on timing and scale, but weak on direction. Grid queues may overstate real demand, efficiency could outrun demand, or AI spending could stall. The report sets out the strongest counter-case and a dated list of checks, including capex guidance in early 2027 and fibre prices by the end of 2028.

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