What If AI Electricity Surge Never Happens

There are more and more skeptics about the AI-crazed financial world. There are two reasons. The first is that none of the AI companies will make money. The other is that the confidential conversion between AI companies and utilities may have tricked utilities into estimating AI electricity demand. 

The first theory is simple to explain. Most AI products are free today. People can download them onto their PCs or phones and use even fairly advanced models from companies that range from OpenAI and xAI. In some cases, the top of the line download and in terms of speed cost $20 a month. xAI has a version of its Grok product that is called “Premium”. It is available on X for $7 a month.

ChatGPT has been downloaded 400 million times this year. In the first half of 2025, OpenAI had revenue of $4.3 billion, but it lost $13.5 billion. Given OpenAI’s dominance of the industry, the revenue of its rivals has to be much lower. Yet, all of these companies are pouring hundreds of billions of dollars into server farms when their investments are put together.

Where Did The Customers Go?

The first appearance of overbuilding will likely come from public companies that need to disclose their AI project financials. Any difficulty with AI revenue and losses will show up in their numbers soon. 

AI expansion is what drives data center buildouts. Those would slow if AI is obviously an industry which can never have a profit.

The other problem was pointed out by CNBC recently. As AI companies go from utility to utility, it is hard to say which ones will become major customers. It is easy to see how they would overestimate

AI demand has become confusing.

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