New York: BlackRock Chairman and Chief Executive Officer Larry Fink has warned that the biggest obstacle to the rapid growth of artificial intelligence (AI) is no longer advanced computer chips but access to reliable electricity. He said the United States must modernise its ageing power grid to keep pace with the soaring energy demands of AI technologies.
Speaking in an interview with CNN’s Fareed Zakaria GPS, Fink said the explosive growth of AI is placing unprecedented pressure on the country’s electricity infrastructure.
“We don’t have enough power in the United States,” Fink said, describing electricity as the most significant bottleneck facing AI development.
According to Fink, the US has sufficient energy resources, particularly natural gas, but lacks the transmission infrastructure needed to distribute electricity efficiently across the country.
“We have plenty of power through natural gas, but we can’t distribute it in a proper way,” he said, adding that the nation would need to invest “hundreds of billions of dollars” to expand and modernise its electricity grid.
He stressed that AI’s future depends on adequate power infrastructure.
“If we don’t do that, we are not going to succeed in AI. AI is just a bunch of electrons. So you need the power to create the electrons,” Fink remarked.
AI Demand Outpacing Supply
Fink said demand for AI computing capacity currently exceeds supply, creating shortages not only in advanced semiconductor chips but also in electricity and other essential infrastructure.
“At this moment, there’s more demand than supply. We have shortages of compute right now, which to me is the biggest problem we have in this country today,” he said.
He also expressed concern that unless AI computing becomes significantly more affordable, smaller organisations could struggle to benefit from the technology.
“I’m not worried about BlackRock or J.P. Morgan having the money to invest in these models. But I am very worried about municipalities or hospitals. Are they going to invest in this?” he said.
Call to Democratise AI
Fink emphasised the need to make artificial intelligence more accessible across society. He urged policymakers and industry leaders to “democratise AI” so that hospitals, local governments, transportation systems and small businesses can adopt advanced AI technologies instead of limiting access to large corporations.
“If we can’t do that, then we’re going to have some real structural issues,” he warned.
No AI Bubble, Says Fink
Despite the surge in AI-related investments, Fink dismissed concerns that equity markets are in a speculative bubble. He argued that exceptionally strong demand has created shortages, allowing some technology companies to command premium prices for their products.
Commenting on the broader economy, Fink said recent geopolitical tensions, including the conflict involving Iran, demonstrated the resilience of the global economy.
“The global economy actually mitigated much of the stresses,” he said, citing increased energy production, diversified supply chains and technological innovation as key factors.
Growth Key to Managing US Debt
Addressing the US fiscal outlook, Fink argued that sustained economic growth remains the best solution to managing the country’s rising debt burden.
“If we cannot grow the economy by three per cent a year, we’re in trouble,” he said, urging policymakers to encourage private investment, accelerate infrastructure projects and streamline regulatory approvals rather than relying on higher taxes.
Fink’s remarks highlight the growing consensus that the next phase of the AI revolution will depend not only on breakthroughs in computing hardware but also on massive investments in energy infrastructure capable of supporting the technology’s expanding power requirements.
