Google $GOOGL is scaling back its energy usage for some data centers that power its AI to help soften the strain AI has placed on the U.S. power grid.
The company on Monday announced new energy-cutting agreements with Indiana Michigan Power and Tennessee Valley Authority through which Google will cut its energy usage during certain times of the day or year, a method called demand response. This is the first time Google is cutting back its energy usage for its AI workload, the company said in a release.
Google said this energy-saving method allows “large electricity loads like data centers to be interconnected more quickly, helps reduce the need to build new transmission and power plants, and helps grid operators more effectively and efficiently manage power grids.”
The tech giant said these new agreements build on its demonstration with Omaha Public Power District, through which Google reduced its power usage for its AI during three grid events in 2024.
“As we add new large loads to our system, it is critical that we partner with our customers to effectively manage the generation and transmission resources necessary to serve them,” I&M president and COO Steve Baker said in the release.
Google said using demand response (or "flexible demand," as the company called it) helps its long-term goal of becoming carbon-free because it helps “bridge the gap” between immediate energy load growth and clean-energy solutions that will take longer to implement.
Last month, Google announced it is spending more than $3 billion in a deal to use hydropower for its data centers.
Google’s new agreements and investment in hydropower come months after its 2024 environmental report showed its carbon emissions have increased by 48% since 2019, in part due to the energy consumption by its data centers.