Brazil is sending a message to the world that it can meet the needs of artificial intelligence (AI) with renewable energy, and the world is listening. The South American nation is flaunting its renewable energy sources and expansive energy grids to court tech companies to set up shop within its borders, and it’s working. Already, Amazon and Microsoft are setting up data centers across the country and pouring billions into the Brazilian economy. 

Currently, the global AI race is dominated by the United States and China. The world’s two largest economies are leading the charge on large language model development and in terms of investment dollars. But as Forbes reports, “The AI contest isn’t about who crosses a finish line first — it’s about who navigates an endless obstacle course with the fewest stumbles.”

And Brazil has a fighting chance to become a major player in that game. “Brazil is well positioned,” Luciana Aparecida da Costa, director of infrastructure, energy transition, and climate change at  Brazilian development bank BNDES, told a reporter for TIME Magazine. “But we know that we have to compete with other countries to attract this.” And competing they are.

Last year, Brazil rolled out a $4 billion AI investment plan to support its own homegrown AI sector. “Instead of waiting for AI to come from China, the U.S., South Korea, Japan, why not have our own?” said Brazilian President Luiz Inacio Lula da Silva while presenting the investment plan. “Our artificial intelligence needs to be intelligent, it needs to be a source of income and employment,” he added. But while the AI plan was built on a platform of sovereignty, it is already pulling in a considerable amount of foreign tech investment.

Critically, Brazil’s AI investment plan includes significant provisions for added energy infrastructure to keep up with the sector’s significant and growing energy demand. AI requires a staggering amount of energy to train its models, and the International Energy Agency projects that this energy footprint is set to double by just 2030 to reach 945 terawatt-hours (TWh), which is roughly equivalent to the annual electricity consumption of Japan. “By comparison, data centres consumed 415 TWh in 2024, roughly 1.5% of the world’s total electricity consumption,” Nature recently reported.

But a huge portion of Brazil’s electricity – almost 90% – comes from renewables. “Access to electricity across the country is almost universal and renewables meet almost 45% of primary energy demand, making Brazil’s energy sector one of the least carbon-intensive in the world,” says the International Energy Agency. This makes the country a very attractive hub for tech companies looking to expand their AI ambitions without totally walking back their climate pledges. Already, Alphabet – the company behind Google – has had to publicly admit that it likely won’t meet its own emissions targets thanks to the deployment of AI.

The question of whether AI will destroy global decarbonization initiatives is a big one, and it has garnered no shortage of discussion in headlines and boardrooms. Unwittingly, Brazil has become a sort of guinea pig to see whether a renewable-focused power grid can sustain a major global data center hub. The result of this experiment could have far-ranging consequences for would-be copycats. “As electricity in some emerging market countries increasingly comes from solar power, they may stand to gain foreign investment – not just from AI but also from any foreign investor who wants their products made cleanly,” reports TIME.

And so far, Brazil seems more than eager to be the global poster child for clean-powered AI. On a panel at the Web Summit in Rio de Janeiro this month, Brazil’s deputy minister of science, technology, and innovation Luis Manuel Rebelo Fernandes declared: “Our message to the world, on the basis of our plan, is that AI [power demand] is satiable with usage of renewable energy sources.”

By Haley Zaremba for Oilprice.com

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