Financial scale versus obsolescence risk

Will artificial intelligence reshape the power grid, or will the inertia and complexity of today’s infrastructure slow progress—or even redefine how large language models, chips, and datacenters are designed and located?  

To meet the exponential rise in energy demand, parts of the industry have taken shortcuts—rapidly adding behind-the-meter capacity through open-cycle gas turbines - OCGT (such as the Titan 350 from Caterpillar) with little regard for environmental regulations. The mantra seems to be speed at any cost.  

Is the AI boom we are witnessing justified—or sustainable? From a technological standpoint, certainly yes: AI capability is roughly doubling every seven months. But from a financial perspective, it is harder to defend—given the sky-high valuations, credit fuelled growth and mounting losses at many of the sector’s biggest players.  

The bigger question is what all this means for the energy system itself. How will AI be powered? What will it do to the cost of energy and the shape of our infrastructure? Will it accelerate—or hinder—the energy transition?  

Hope is powerful—but it can also be blind. Between AI’s explosive growth and the traditional energy system’s entrenched realities, who will bear the cost?  

These are the questions Laurent and Gerard pose to Andrew Perry, Director of the Energy Transition and Environment business unit at Faculty.ai, where he leads AI-driven innovation in the energy sector.   We have a heated debate, trying to honestly lay out the dilemmas in front of the industry. 

More insights in this excellent research by the FT
https://ig.ft.com/ai-power/

Today’s show is supported by the BMW Foundation Herbert Quandt. The BMW Foundation unites leaders from diverse sectors to develop solutions that foster an innovative economy and a future-proof society. A key focus is "Energy Transition & Climate Change," where the Foundation drives "International collaboration to accelerate the energy transition." With rising energy demands from AI and data centers, new partnerships, effective collaboration, and the exchange of science-based solutions and strategies are essential. That’s why the BMW Foundation supports this podcast and brings these discussions to global stages by hosting the Energy Security Hub at the Munich Security Conference 2026, streaming live February 12–14.
Learn more at www.bmw-foundation.org