IT in Manufacturing


What lies beneath – the hidden cost of AI

March 2025 IT in Manufacturing


Ben Selier, vice president, Secure Power, Anglophone Africa at Schneider Electric.

The world is quickly realising that with the rapid advancement in AI, there are also caveats. Apart from environmental implications, it also has significant financial ramifications.

As an example, according to Forbes, the costs of training and running AI models, especially Large Language Models (LLMs), are substantial. These models require enormous computational resources, leading to soaring computing costs. Indeed, the cost of computing is expected to climb 89% from 2023 to 2025. A massive jump in a very short time span.

Elaborating a bit on the above, LLMs are based on transformer models, a type of neural network architecture developed by Google in recent years. But, with the mindboggling interest generated by ChatGPT in 2022, transformer models are now being used throughout the industry. Unfortunately, these transformer models are costly when required to process these massive amounts of data.

For example, a transformer processes a large amount of unlabelled data to learn the structure of a language or phenomenon and how nearby elements affect each other. This is an extremely energy-intensive exercise, and it cost millions of dollars to train some of the largest models. When you then add the cost implications of data centre cooling and operational complexity into the mix, it’s easy to understand why AI is expensive − very expensive.

Power demands and over-engineering risks

As mentioned, modern AI workloads require an enormous amount of power. In fact, some estimate the power needs of AI and cloud computing are growing at such a rate that individual data centre campuses could soon use more electricity than a small city. It is also important to pinpoint exactly where more power and cooling are required; for example, some parts of a data centre don’t deal with HPC and AI processing. Here, precise power design and allocation are essential as overprovisioning can lead to wasted resources and under-utilised infrastructure.

This is probably relevant across many continents, as AI is forcing data centre operators to augment their energy sourcing strategies. Relying solely on grid power is no longer sustainable, especially in regions where electricity prices are volatile or where utility providers impose steep tariff hikes. Data centre operators are exploring renewable energy solutions, such as solar and hydrogen, to mitigate costs and improve sustainability.

Hybrid energy models offer another viable solution. By scheduling HPC workloads during periods of peak solar generation, data centres can reduce reliance on non-renewable sources and lower their carbon footprint. Again, these models require careful planning and advanced scheduling systems, but also promise long-term financial and environmental benefits.

Cooling

Cooling is another area where AI workloads are driving up costs. While this topic has been explored at length, it’s important to recognise that traditional air-cooling methods are simply not good enough for HPC environments, especially outside naturally cold climates like the Nordics.

Advanced cooling technologies such as liquid cooling are now indispensable for maintaining operational efficiency. Liquid cooling offers a more effective way to dissipate heat in high-density environments, reducing energy consumption and enabling data centres to handle increased computational loads. However, these systems come with their own set of challenges, including higher upfront costs and the need for specialised maintenance.

Managing systems to drive down costs

To manage the abovementioned complexities, data centre infrastructure management (DCIM) and building management systems (BMS) have shifted from ‘nice-to-have’ to essential. These systems provide granular visibility into power and cooling dynamics, enabling operators to allocate resources more efficiently.

For instance, monitoring the heat generated by individual GPUs allows precise adjustments to cooling requirements, reducing waste and ensuring optimal performance. The ability to allocate power and cooling dynamically only where it is needed can significantly lower operational costs.

The above is extremely valuable when looking at ways to drive down the costs of AI and mitigate its environmental impact. This is a priority – especially in a time where what lies beneath are power hungry data centres, driving all things AI.


Credit(s)



Share this article:
Share via emailShare via LinkedInPrint this page

Further reading:

Prefabricated data centres for an AI-focused future at the edge
Schneider Electric South Africa IT in Manufacturing
As AI technologies continue to advance, data centres are being pushed to the edge, reshaping their operations to meet daily demands. To meet the relentless demands of AI workloads at the edge, prefabricated data centre solutions offer a scalable, efficient and fast alternative to traditional builds.

Read more...
Quantum computing and its impact on data security: a double-edged sword for the digital age
IT in Manufacturing
Quantum computing is poised to redefine the boundaries of data security, offering groundbreaking solutions while threatening modern encryption’s foundations. For third-party IT providers, this duality presents both a challenge and an opportunity to lead organisations through one of the most significant technological transitions in decades.

Read more...
TechAccess and Schneider Electric partnership goes from strength to strength
Schneider Electric South Africa News
Schneider Electric, together with its longstanding partner TechAccess, is poised to take the Southern African market by storm.

Read more...
Next-generation road-legal race car.
Siemens South Africa IT in Manufacturing
Siemens Digital Industries Software has announced that Briggs Automotive Company (BAC) will move to the Siemens Xcelerator portfolio of industry software and use it to develop the next generation of its single-seater road-legal race car, Mono.

Read more...
Cybersecurity at a crossroads
IT in Manufacturing
here’s a growing unease in boardrooms, data centres and cabinet offices across South Africa. It’s not just about economic headwinds or political uncertainty, it’s about something quieter, more technical and yet just as dangerous - the rising tide of cyber threats.

Read more...
Enabling a sustainable industrial organisation
IT in Manufacturing
This article explains the top sustainability trends and key actions that you can leverage to become a more sustainable organisation.

Read more...
Navigating discrete manufacturing in South Africa through digitalisation
IT in Manufacturing
South Africa’s discrete manufacturing sector faces mounting pressure from global competition, fragmented supply chains and outdated infrastructure. In this complex environment, digitalisation is a critical lever for survival, resilience and growth.

Read more...
Africa’s pragmatic approach to AI and how data centres are enabling it
Schneider Electric South Africa IT in Manufacturing
In Africa, the current AI momentum is driven by a fundamental need, building a resilient digital infrastructure that addresses the real-world challenges of the continent’s communities.

Read more...
World first simulation of error-correctable quantum computers
IT in Manufacturing
Quantum computers still face a major hurdle on their pathway to practical use cases, their limited ability to correct the arising computational errors. In a world first, researchers from Chalmers University of Technology in Sweden have unveiled a method for simulating specific types of error-corrected quantum computations.

Read more...
Platform to accelerate supply chain decarbonisation
Schneider Electric South Africa IT in Manufacturing
Schneider Electric has launched Zeigo Hub by Schneider Electric, a powerful new digital platform designed to help organisations decarbonise their supply chains at scale.

Read more...









While every effort has been made to ensure the accuracy of the information contained herein, the publisher and its agents cannot be held responsible for any errors contained, or any loss incurred as a result. Articles published do not necessarily reflect the views of the publishers. The editor reserves the right to alter or cut copy. Articles submitted are deemed to have been cleared for publication. Advertisements and company contact details are published as provided by the advertiser. Technews Publishing (Pty) Ltd cannot be held responsible for the accuracy or veracity of supplied material.




© Technews Publishing (Pty) Ltd | All Rights Reserved