In 2019, when I was the Chief Scientist at the Ministry of Energy, experts in the field of Data Centers approached us and asked for our assistance in promoting the sector in Israel. The difficulty was that these facilities required both robust data communication and a reliable, high-capacity power supply—two areas in which Israel did not excel. We made great efforts at the time to launch a government initiative on the matter, but we failed; the issue did not interest other parties.
Since then, a big buzz has developed around the topic of data centers, and everyone is engaged. I recently returned from the US, and all the discussion in the energy world there revolves around the difficulty of supplying power to these computing machines. In Israel, too, articles are beginning to be published warning of an inability to supply electricity. Data centers are enormous computer systems required for our computerized world, which has recently adopted an additional use for them—AI (Artificial Intelligence). The energy connection is critical. Computers, in aggregate, consume a lot of electricity, a large portion of which is wasted as heat—I will write about that in a future article. In fact, it has become common practice for the size of a data center to be measured by its electrical power capacity in Megawatts (MW). Large data centers today require a connection of about 100 MW of electricity—comparable to the connection of a city of 50,000 residents or more!
The power supply to data centers must be highly reliable—meaning the computers must always operate without fear of blackouts. This is one of the factors delaying the construction of data centers today, as not every location has sufficient electricity. From a different perspective, this factor dictates the location of the centers—based on the availability of high-power capacities.
It is important, however, to place the issue of energy supply to data centers in the overall perspective of the energy world. Electricity consumption is growing due to the rise in the global average standard of living, which drives consumption for lighting and air conditioning, and due to global electrification processes, such as the transition to electric cars. The electricity consumption of data centers today is estimated at about 1.5% of global electricity consumption. The forecast for 2030 speaks of doubling this consumption! Doubling or even tripling the consumption will increase global electricity consumption by 2-3%, while the world must contend with a much more significant general increase in consumption, all under the constraint of supplying clean energy. The main difficulty regarding data centers stems from their nature as a large consumer at a single point.
So, how can we provide a reliable 24/7 power supply to these centers without increasing emissions and pollution? The tendency of data center planners is to try and find an independent solution for power supply—for example, establishing an adjacent power plant to the center. Building such a power plant can reduce the center’s electricity expenses, which are its primary cost, by 50% or more, as the owner takes all the power from the plant and is not required to pay the electricity grid costs. The demand for reliability and availability clashes with the unstable nature of solar or wind clean energy, so center planners are looking for other solutions, such as gas-fired power plants or nuclear power plants.
In Israel, the nuclear option is not currently on the table, and therefore the regulator must intervene and find a solution that does not hinder the establishment of data centers, so that Israel does not fall behind, but also does not rely solely on natural gas, in order to avoid failing in the attempt to transition to clean energy. Additionally, the construction of gas-fired power plants takes close to 10 years, so if readily available solutions are desired, other alternatives must be sought. A worthy solution is the establishment of data center complexes in the Negev, adjacent to large solar fields—for example, in the Oron-Tzin area. This is an area of defunct quarries; it is a disturbed area, and in the overall environmental considerations, it is appropriate that it contribute to reducing the environmental harm caused by electricity generation from fossil fuels by dedicating the area to the establishment of solar fields. The site has enormous potential of over 10 GW (Gigawatts), more than all that has been built in Israel to date. The regulation must ease the establishment of centers in these complexes and enable robust communication to them. Furthermore, the regulation must mandate a minimum percentage of the centers’ electricity consumption—about 40%—to come from a clean source. Locating the electricity consumers close to the production also saves on the construction of the electricity grid required to transmit the energy to the center of the country, where most of the centers are located today. The grid is one of the most difficult bottlenecks for the continued development of renewable energy, as its construction takes a long time. Locating the centers in the Negev also has a clear real estate advantage against the lack of real estate in the central region of Israel.
And what about the doomsday forecasts that there will not be enough electricity for data centers or in Israel in general? It is better not to deal with predictions that are too far in the future. Technology is advancing at a very rapid pace—this is what I do for a living: investment in innovative energy technologies. On the consumption side, it is very difficult to estimate today what the consumption of data centers will be in another 15 years, and how the world of AI will evolve. For example, will AI models be more efficient, or will computers be more efficient because large parts of them will be optical, or will cooling technologies become twice as efficient? Technology is also advancing rapidly on the electricity supply side. For instance, it is possible that in 10 years, solar fields will be able to supply 50% more energy from the same area, or that electricity storage from them will become three or perhaps ten times cheaper, as has happened in the last decade, which will change completely the economics of storage. In the nuclear domain as well, there are major efforts to produce SMRs – Small Modular nuclear Reactors that are efficient and safe. These reactors will be an off-the-shelf product from a factory and shipped as a single unit to their operating location. This may also enable Israel to join the nuclear domain.
And perhaps with the help of AI, we will be able to find solutions to the energy problems of data centers?
👉 Read the full article published at TheMarker (in Hebrew only): https://www.themarker.com/blogs/2025-10-20/ty-article/00000199-fc48-d582-a39f-fefc5a830000
Image Credit: John Amis.