EU Commission Proposes Smart Meters to Manage AI Data Center Energy Demand

BRUSSELS — The European Commission wants households to use less energy at peak times in preparation for an explosion of power demand from artificial intelligence data centers and electrification of the economy.

The EU executive said Wednesday it will propose a new law later this year to accelerate the roll out of AI-powered smart meters, which give consumers "greater control over when they use electricity, allowing them to shift consumption to cheaper hours and lower their bills."

The hope is this will prompt households to cut their electricity use at evening hours when demand is highest, keeping prices lower and leaving more power available for industry, transport and energy-hungry computers that perform advanced AI functions.

The plan, part of the Strategic Roadmap for Digitalisation and AI in the Energy Sector, was released Wednesday as part of the EU tech sovereignty package.

Data centers already account for 2.5 percent of EU energy use, the Commission said in the roadmap, and demand is expected to more than double over the next four years. That will put increasing pressure on a grid already struggling to meet the demands of the clean energy transition.

Energy Commissioner Dan Jørgensen presented the roll out of smart meters as one of the positive impacts of AI, saying it would help households save money on their energy bills. He said it was not part of the Commission's proposed response to soaring demand from data centers.

But smarter, dynamic use of electricity is key to making the most out of existing networks at a time when electricity demand — from things like data centers, electric vehicles, heat pumps, hydrogen electrolyzers and electric smelters — risks running far ahead of reliable supply from clean sources such as renewables and nuclear.

Smart meters can "contribute to improving the utilisation of existing electricity network

infrastructure, including by reducing the curtailment of renewable energy and facilitating

electrification," the Commission's roadmap said.

The roadmap contained seven "flagship actions," of which the smart meter legislation was one.

As previously reported by POLITICO, the Commission backtracked on an earlier plan to impose mandatory energy-efficiency standards on data centers by 2030. It also delayed plans to release a labelling system that rates the sustainability of data centers. That's now expected later in the summer.

Other measures in the roadmap included a non-binding agreement between data centers, energy suppliers and authorities for "the sustainable integration of data centres into the energy system;" a new EU framework improving "cross-border energy data exchange for smart energy services and AI model training;" and a promise to track progress annually.

Horizon Europe, the EU's research and development fund, will also provide €75 million to develop energy-efficient AI strategies.

CORRECTION: This article was updated June 3 to correct the day the proposal was published.