Morgan Stanley analyst Stephen Byrd reports that US data center developers face a power deficit of 70 gigawatts by 2028. The bank estimates total power demand will reach 97 gigawatts, marking a 43% increase from the previous forecast of 68 gigawatts. This surge is attributed to rising chip shipments and the deployment of high-power rack systems, including those from Nvidia.
The projected shortfall has grown from an earlier estimate of 57 gigawatts. Even after accounting for onsite power generation solutions like gas turbines, fuel cells, and nuclear co-location, the net deficit remains at approximately 33 gigawatts. Projections indicate the gap could further widen to between 68 and 72 gigawatts by 2029.
The report identifies a shift in industry constraints from chip supply chains to electricity availability. While major technology companies are better positioned to secure power, smaller developers face higher risks of project delays due to limited capital and less leverage with utility providers. Nvidia is noted as being relatively insulated from these power shortages.
Converted Bitcoin mining facilities are identified as a potential, though ancillary, solution to the power crisis. These sites already possess established grid connections and the infrastructure necessary to handle heavy electrical loads. The research warns that if power supply fails to keep pace with demand, significant capital investments in data centers may remain underutilized.
