How fusion energy and AI can power the next era of energy demand

We are entering the “Age of Electricity,” according to the International Energy Agency’s World Energy Outlook 2025. As advanced and emerging economies make that shift, the world will experience an unprecedented 40% surge in electricity demand in less than a decade.

The biggest drivers are unsurprising: the adoption of artificial intelligence (AI) along with the related buildout of data centres carry an enormous appetite for power. In the United States alone, data centres may require more than 100 gigawatts of new capacity, with similar pressures mounting in Europe, India, China and the Middle East.

But the challenge is bigger than that.

Industrial reshoring, widespread electrification and rising heating and cooling loads driven by extreme weather are placing new upward pressure on energy demand, weakening the long-standing relationship between economic growth and declining energy intensity.

Global investment in power generation has raced to about $1 trillion per year since 2015, while grid spending lags at roughly $400 billion, producing congestion, curtailment and interconnection delays.

In the United States, critical data centre projects are being held back by 2 to 6 years, compounded by shortages of transformers and switchgear. Efficiency helps but AI‑optimized servers draw two to four times the power of traditional servers.

We are entering a new industrial age where today’s breakthroughs require more clean, reliable power than any period in modern history.

The development of energy technology will determine how far and fast a power transformation can go. Scalable, clean baseload power underpins all infrastructure, from data centres to supply chains and without an abundant and resilient energy source, progress will stall.

Fusion energy could change that.

Fusion is the energy source that powers the stars. It has the potential to provide the energy needs of modern cities and industries without emitting carbon dioxide or other greenhouse gases. This positions fusion as a potential backbone of global digital infrastructure.

According to the Max Planck Institute, fusion energy power plants will supply power similar to that of present-day large-scale power stations powered by coal but with vastly different amounts of fuel needed.

One gram of fusion fuel could provide 90,000 kilowatt-hours of energy in a power plant, comparable to the combustion heat generated by 11 tons of coal.

Fusion power plants are also designed to be inherently safe, without the risks of runaway reactions, meltdowns or high-level, long-lived radioactive waste. It also avoids the regulatory red tape of traditional nuclear fission. Fusion energy can be sited and scaled to provide primary energy wherever and whenever it is needed.

Fusion power plants are also designed to be inherently safe, without the risks of runaway reactions, meltdowns or high-level, long-lived radioactive waste. It also avoids the regulatory red tape of traditional nuclear fission. Fusion energy can be sited and scaled to provide primary energy wherever and whenever it is needed.

For science and manufacturing, abundant energy to accelerate computation power shortens development cycles and expands what’s possible.

For the first time, shifting to fusion could allow us to build technology that produces energy rather than relying on finite resource consumption.

This unlocks a new class of economic opportunity, from high-value manufacturing and advanced materials to resilient domestic power for AI, data centres, and energy-intensive industries, while establishing a fundamentally new paradigm for energy security.

If fusion energy is deployed at scale and countries achieve energy independence, energy supply would also evade geopolitical tensions that has allowed states to weaponize energy resources. Global markets would, therefore, become far less vulnerable to the energy-driven price shocks and inflationary pressures that have historically followed armed conflicts.

If fusion energy is deployed at scale and countries achieve energy independence, energy supply would also evade geopolitical tensions that have allowed states to weaponize energy resources. Global markets would, therefore, become far less vulnerable to the energy-driven price shocks and inflationary pressures that have historically followed armed conflicts.

Technology innovations in fusion, recently driven largely by the private sector, will make it possible for this new energy source to become a baseload resource capable of stablizing grids, enable electrified industries and support mission-critical power.

A site in Virginia for the world’s first grid-scale commercial fusion power plant is now zoned specifically for a fusion power plant, with permitting and construction as the next steps toward putting electricity onto the grid by the early 2030s.

Leaders around the world are also working to accelerate deployment, with the United States establishing an Office of Fusion to make it a clear priority. China is also investing billions in their capabilities, Germany developing a funding programme for startups and several countries around the world, from the United Kingdom to Japan, adopting regulatory frameworks to provide certainty to developers.

Fusion energy can provide the large amounts of reliable, emissions-free power that advanced AI systems require. In turn, AI can accelerate the design, operation and commercialization of fusion itself. This creates a first-of-its-kind symbiotic relationship: a self-reinforcing cycle in which fusion enables AI and AI accelerates fusion’s path to scale.

Together, this emerging AI-fusion nexus has the potential to reshape industrial systems, strengthen energy security and open new manufacturing and scientific frontiers, rather than merely meeting today’s energy demands.

Sustained economic growth will increasingly depend on investments in advanced energy systems, including the development and deployment of commercial fusion and on integrating these systems with AI, industrial and manufacturing ecosystems.

Regulatory and policy frameworks that support scaling and attract private-sector capital will be important enablers of this process.

Many countries are beginning to develop strategies that align technological innovation with energy and security priorities, bringing these considerations into a more coordinated policy framework.

Decisions made in the coming years, such as where to site data centres, how to modernize power grids and expand transmission and how to secure supply chains for advanced materials, will influence the reliability, affordability and resilience of future energy systems, as well as their capacity to support economic activity and national security objectives.

The overarching objectives are greater resilience, productivity and strategic autonomy. Building domestic capabilities across the fusion value chain can contribute to these goals and shape longer-term leadership in energy and related technologies.

While outcomes will depend on execution and global conditions, the next decade represents an important window in which countries can position themselves within this emerging energy-technology landscape.