Until recently, data centers were largely background infrastructure—quietly plugging away enabling us to send emails, work online and stream our favorite shows. That all changed in November 2022, when OpenAI released the first iteration of ChatGPT.
Since then, so-called 'hyperscalers', those investing in large-scale data centers such as Meta, Microsoft, Amazon, and Alphabet, have been rushing to invest in AI capabilities, committing a collective $200 billion globally by 2025. AI workloads require advanced chips—specifically GPUs and other high-performance accelerators—more of them, and far more densely packed. As a result, energy use per rack—a key measure of power intensity—can be six times higher in an AI-optimized facility compared to traditional cloud infrastructure.
As well as introducing the world to enough new acronyms and technical terms to put the energy sector to shame, the AI boom also brings with it the potential for a significant rise in electricity demand. Goldman Sachs projects that global data center power demand will grow by 165% by 2030.
Meeting this demand presents a threefold power challenge: speed, stability, and sustainability. Biomass delivers against all three and offers a compelling solution for data center developers.
AI infrastructure is being developed on start-up timelines, but the grids meant to supply power are often hampered by multi-year planning cycles and limited capacity. Utilizing the existing biomass fleet or retrofitting coal-fired power stations to run on sustainable biomass bypasses these time-intensive and costly barriers These sites are already grid-connected, often already have relevant permits, and crucially a coal-to-biomass conversion can be completed in under two years.
AI workloads bring distinct power challenges. AI models require 24/7 power. Training can last weeks, and inference tasks (responding to users' requests) require instant responsiveness. This combined with the need for ultra-dense racks leaves little room for power fluctuations or cooling lapses.
At the same time, it is imperative that the increased power demand is not met by derailing our climate goals. In the EU there is a need to balance goals for a Digital Decade with the demands to reach climate neutrality by 2050. At the same time, the hyperscalers leading the charge have committed to run their platforms on fossil-free power. This creates a clear need not just for reliable power, but for reliable low-carbon power.
This is where biomass complements the broader renewable mix. Technologies like wind and solar are essential—but variable. Their growth needs to be matched with firm, dispatchable sources to ensure continuous availability. Biomass offers exactly that. It can deliver stable baseload power without reliance on large-scale storage or complex grid balancing. It's also comparatively quick to deploy and, in some contexts, more cost-effective than new nuclear.
Moreover, biomass aligns with global climate objectives. When sustainably sourced, it delivers significant lifecycle emissions reductions. Both the International Energy Agency (IEA) and the Intergovernmental Panel on Climate Change (IPCC) have identified bioenergy as a critical part of the clean energy transition.
The potential is even greater when biomass is paired with carbon capture and storage (CCS). This combination, known as BECCS, can generate negative emissions—removing CO₂ from the atmosphere while powering high-demand applications like AI. For digital infrastructure providers seeking to scale responsibly, BECCS offers an energy source that not only fuels progress but can help deliver the gigatonnes of carbon dioxide removal we'll need to reach our climate targets.
In this context, biomass powered data centers are not a silver bullet—nothing is when it comes to energy and climate—but they could be a key piece of the puzzle. They offer clean, firm power at speed and scale, using infrastructure that already exists. The AI revolution doesn't just need more energy—it needs energy that is reliable, rapid to deploy, and climate-friendly. Biomass, as part of a diverse energy mix, is one of the few options that can deliver on all three fronts. For the data center sector, it may be time to take a closer look.
About the author
Andrew Georgiou
Vice President, Global Policy, USIPA
Andrew Georgiou is Vice-President for Global Policy at the US Industrial Pellet Association (USIPA), a wood energy sector trade association representing members operating in all areas of the wood pellet export industry. With almost 15 years of experience working in politics and public policy he leads USIPA's engagement with policymakers across Europe, the US and Asia. He sits on the Board of Bioenergy Europe and takes part in a number of working groups on a broad range of biomass policy issues affecting markets across the globe.
