Aligning AI deployment with environmental sustainability

Artificial intelligence is accelerating at a pace without precedent, but its energy appetite is growing just as rapidly. 

Data centers worldwide consumed about 415 terawatt hours of electricity in 2024 and with AI workloads rising sharply, global demand could surpass 1,000 terawatt hours by 2026, roughly equal to Japan’s annual consumption. This surge presents a defining question: can AI’s economic promise be separated from its environmental externality cost?

AI expansion brings multiple externalities that extend beyond electricity footprints. 

Data centers require vast volumes of water for cooling, which could reach as much as 4.2 to 6.6 billion cubic meters per year globally by 2027. Chip manufacturing generates e-waste and chemical pollution, while large-scale server farms place new pressure on land use and local grids. These externalities reveal that AI’s growth must be managed through advanced climate-aligned governance.

The risks emerge alongside a world already warming at an alarming pace. More than 2.4 billion workers globally now face unsafe and inadequate working conditions due to rising heat, with productivity losses increasing year after year. Climate change is already costing the world hundreds of billions of dollars annually in lost economic output and disrupted labour systems, and 2024 was the hottest year ever recorded, underscoring how rapidly conditions are deteriorating.

Many regions are warming more quickly than infrastructure and system protections can adjust, eroding economic resilience and straining national budgets. In this context, an AI boom that adds further emissions would place additional pressure on countries already struggling in managing climate-related issues.

This reality underscores the importance of strong climate-adaptation and mitigation governance, supported by nature-based solutions that restore ecosystems, strengthen resilience and integrate system-level thinking. Aligning AI deployment with environmental sustainability is no longer optional; it is essential to ensuring that innovation does not undermine long-term stability.

AI also provides powerful tools for climate progress. It can optimize electricity grids, improve weather modeling, accelerate discovery of low-carbon materials and support decision-making in water, food and energy systems. 

As Tony Sheldon of Yale University notes, “durable development outcomes depend on structural scaffolds that enable collaboration across sectors rather than fragmented responses.” His insight applies directly to AI: only with strong cross-sector governance can technology serve the greater public good.

Similarly, Todd Cort of the Yale Center for Business and the Environment observes that “investors increasingly reward companies that internalize sustainability risks rather than defer them to future liabilities.” 

For AI, this means companies and governments that adopt climate-aligned design, energy sourcing and lifecycle planning will be more competitive in the global market.

Saudi Arabia is emerging as a central force shaping this new era. Under Vision 2030, AI is projected to contribute over 135 billion dollars to its gross domestic product by 2030. Saudi Arabia has set a target to source at least 50 percent of its power from renewable energy by 2030, expanding its total electricity capacity to around 130 gigawatts, including 58.7 GW of renewables (primarily solar and wind). This energy transformation provides the backbone for sustainable AI expansion.

Saudi Arabia’s recent agreements highlight the scale of its leadership. At the US–Saudi Investment Forum on Nov. 19, Humain announced a joint venture with Advanced Micro Devices and Cisco to build renewable-powered data centers beginning with 100 megawatts in the Kingdom and scaling to 1GW by 2030. 

Aligning AI deployment with environmental sustainability is no longer optional; it is essential to ensuring that innovation does not undermine long-term stability.

Adnan Masoudy and Hassan Alzain

A parallel agreement will see xAI and NVIDIA develop a 500MW AI facility deploying up to 600,000 advanced NVIDIA processors over three years, with Grok AI rolled out nationwide for ministerial, enterprise and citizen-facing services.

The Kingdom is strengthening human capital alongside infrastructure. The “One Million Saudis in AI” program has trained more than 1 million people, with about 52 percent women. This scale of talent development is rare globally and ensures the workforce can build, regulate and maintain green AI systems across national sectors.

Saudi Arabia is also advancing international discussions in new forms of clean “energy addition” to support its AI ambitions. Nuclear energy, including small modular reactors, is being explored as a stable low-carbon base-load for large AI campuses. These systems complement the country’s solar, wind and green-hydrogen investments, including the $8.4 billion NEOM hydrogen plant integrating more than 4GW of renewable power once fully operational.

Saudi Arabia should lead the world’s tech race toward climate smart AI growth with five key recommendations.

First, ensure that all large data centers and AI clusters use clean electricity sourced from renewables, nuclear and other low-carbon sources, supported by emissions offsetting solutions.

Second, establish national environmental standards addressing cooling efficiency, water consumption, electronic waste and full hardware lifecycle management relevant to data centers.

Third, build specialized climate, energy and sustainability tracks within the “One Million Saudis in AI” program to anchor national expertise in green AI infrastructure and end-user services.

Fourth, champion a dedicated agenda item under the UN Framework Convention on Climate Change to promote global standards for sustainable digital infrastructure and emissions minimization and transparency.

Fifth, embed climate accountability in all public and private AI investments, requiring measurable reductions in emissions intensity for each unit of computational power.

Saudi Arabia now stands at an exceptional intersection of technological ambition and environmental responsibility. With its scale, resources and long-term strategy, the Kingdom can demonstrate how a fast-growing AI economy can be powered by green energy, governed transparently and aligned with planetary limits. 

If Saudi Arabia continues on this path, it will shape not only the future of regional innovation but also the global standard for climate-aligned digital and technological growth.

• Adnan Masoudy is manager of corporate sustainability, environment, and biodiversity at Ma’aden.

• Hassan Alzain is author of the award-winning book “Green Gambit.”