The Bank for International Settlements (BIS) published Paper No. 174 on October 8, 2026, authored by economists Leonardo Gambacorta and Salvatore Polizzi. The study examines how the environmental footprint of artificial intelligence, specifically high electricity demand from data centers, complicates the economic indicators used by central banks to set interest rates.
The authors note that rising energy consumption by AI systems can distort signals such as capacity utilization and inflationary pressure. According to the International Energy Agency, global data center electricity consumption could exceed 945 terawatt hours by 2030, which is more than double current levels. This intensity creates upward pressure on power prices and strains energy grids.
The report highlights a potential risk to financial stability stemming from massive investments in AI infrastructure and energy generation. If these projects fail to deliver expected returns, the resulting economic impact could be significant. The BIS suggests that central banks should integrate environmental effects into their monetary policy frameworks to avoid misinterpreting energy-driven price hikes.
The study outlines two potential scenarios for AI development: an incremental integration into the economy and a transformative shift toward artificial general intelligence. Each path presents distinct uncertainties for policymakers. While acknowledging AI's role in improving energy efficiency and forecasting, the paper emphasizes that its energy costs are now a critical factor in macroeconomic analysis.
