The International Energy Agency has published new statistics regarding the use of energy input in different sectors and industries. As per the report, the aggregate energy consumption of the blockchain sector is set to increase. Based on the technological changes, the world is transitioning from fossil fuel resources to renewable energy methods for electricity production.
The trend is also influenced by de-carbonization efforts and regulatory requirements. However, the electricity manufacturing industry is also looking at the latest usage statistics.
To this end, analysts at IEA claim that cryptocurrency mining and AI sectors are set to witness big changes in energy usage in the upcoming years. The IEA is a multinational intergovernmental organization based out of Paris, France. Analysts at IEA have observed that all power consumption projections are not bad.
The report published in 2024 also projected that the current methods of power generation are the biggest contributors of CO2 emissions in the world. At the same time, the report relayed that the aforementioned sectors are also one of the fastest ones transitioning into zero emissions.
The Bright Future of Renewable Energy Sources
The report has also suggested that Renewable sources are going to become the biggest source of electricity production by 2025. The report also shared that consumption metrics reduced by 2.4% in 2022 to 2.2% in 2023. However, there is an expectation of rise to 3.4% by 2026. The report suggests that China and India are going to be the main contributors that are projected to be main contributors in this matter.
On the other hand, data centers for AI and blockchain projects have increased by 200% for the duration reaching a whopping 1000 TWh. This quantity accounts for one-third of all data centers operating in the United States.
Meanwhile, the firm has noted that AI is going to take the lead in terms of electricity consumption which is expected to increase by 1000% from 2023 to 2026. As per the report, ChatGPT utilizes around 10 TWh per year. Meanwhile, one ChatGPT search consumes 10 times more energy in comparison to a Google search.
For context, the analysts noted that all 70K US households require one TWh worth of electricity supply for a year. Based on this data set, the blockchain industry and related sectors will utilize the same amount of electricity as Japan.
IEA Report Unveils Bitcoin Power Usage
IEA report also shed light on Bitcoin electricity usage for 2023 noting it around 120 TWh for 2023. Meanwhile, the remaining crypto mining farms utilized 10 TWh for the same duration. The figure increased from 2022 which recorded 110 TWh in 2022 and represented 0.4% of the global energy consumption.
IEA also projected that the blockchain industry energy utility is going to grow to 160 TWh by 2026. The report suggests that the overview suggests that blockchain mining sector consumes a very small portion of global energy production.
However, the report also noted that the blockchain sector has continued to make efforts to shift power dependency towards renewable energy and clean sources. Bitcoin mining firms have converted to 54.5% of sustainable energy sources. At the same time, mining activity is picking up pace in the pretext of the upcoming halving event in April. On this account, various mining firms are reportedly ordering and setting up new equipment.