Japan Weighs AI Growth and Energy Demand Amid DeepSeek’s Emergence

Japan’s Ministry of Economy, Trade, and Industry (METI) acknowledges concerns about rising electricity demand due to data center expansion but says it's too early to predict the impact of AI innovations like DeepSeek.

In December, Japan released a draft of its basic energy plan, forecasting a 10-20% rise in electricity generation by 2040, citing increased AI-driven consumption. However, the recent rise of Chinese AI startup DeepSeek, which may be more energy-efficient than competitors, has sparked debate among analysts. Some believe this could reduce power consumption, while others argue that as AI technology becomes more accessible, demand may still rise.

In an email, METI stated that AI-related energy consumption is influenced by multiple factors, including advancements in AI performance, cost reductions, and energy-efficient technologies. The ministry emphasized that a single example, such as DeepSeek, cannot determine future energy trends.

Japan’s economic growth and industrial competitiveness, METI added, will depend on securing enough decarbonized power sources to support expanding AI usage. As AI adoption accelerates globally, Japan must balance innovation with sustainability, ensuring sufficient energy resources while maintaining technological leadership.