"It takes 100x"- Shark Tank investor Kevin O'Leary talks about the required power needed for AI

According to Shark Tank investor Kevin O’Leary, Artificial intelligence (AI) systems demand a staggering amount of power compared to older generations of computing. During a live interview with Fox Business on December 27, 2024, O'Leary shared:

“What I'm focusing on is figuring out power, our grid...We talk about the demand for electricity, not just for AI. But to understand something about AI, it takes 100x the power required to the old generation of computers.”

This significant increase in energy demand has brought the power grid and alternative energy solutions to the forefront of discussions among investors and policymakers. O’Leary emphasized that resolving the energy challenge is critical to supporting AI advancements.

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Kevin O'Leary of Shark Tank discusses AI's game-changing power requirements

The energy demand for artificial intelligence

AI technologies, particularly those involving large-scale machine learning models, consume vastly more energy than traditional computing systems. This "100x" power requirement stems from the intensive computations involved in training AI models, processing large datasets, and deploying these systems across industries.

To meet these demands, the Shark Tank investor emphasized the need for high-capacity power sources, saying,

“We need a gigawatt of power. You can't get that anywhere on the U.S. grid anymore.”

A gigawatt, equivalent to the energy used by approximately 750,000 homes, is difficult to source within the current energy grid in many regions, especially given growing demands from other sectors.

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Current energy solutions and challenges

In his interview, O'Leary mentioned some future energy sources that might meet AI's needs. Nuclear and geothermal energy are perceived as future opportunities, but natural gas seems to be the most current option. Citing deregulation debates currently being heard under political leadership, O'Leary said,

“Right now, it looks like gas is the winner.”

He also indicated a unique opportunity in Alberta, Canada, where Danielle Smith has positioned the region as a leader in affordable energy. According to O'Leary, Alberta has "the lowest cost of energy anywhere in the world right now." This could make Alberta a critical partner for U.S. stakeholders looking for reliable and cost-efficient power solutions.

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Implications for policy and investment

O’Leary’s comments underline a pressing issue for governments and investors: ensuring energy infrastructure can support the exponential growth of AI. He speculated that Danielle Smith’s role in Alberta's energy sector would gain prominence, particularly in Washington, D.C., as discussions intensify over cross-border energy collaborations. In his Instagram post of his Fox Business interview, he wrote:

"Danielle Smith up in Alberta has all the power in North America. We're gonna have to work out a deal with her. She's got the lowest cost of energy anywhere in the world right now."

The need for such collaborations is underscored by limitations in the U.S. power grid. The Shark Tank investor highlighted that the focus on sustainable and scalable solutions—whether through deregulation, new energy deals, or innovations in renewable energy—will likely shape investment strategies and political agendas in 2025 and beyond.

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