Forrester’s 2027 Forecast: How AI Growth Forces Hard Choices on Energy, Water, Land, and Communities

The useful part

In its next phase of growth, physical capacity for growth will be as crucial as model capability. This insatiable demand for energy but also water and land has created a rare universal agreement. Who gets scarce power, who bears the responsibility for optimization of AI infrastructure, who absorbs risk, and who benefits?

How it works

• No organization can ignore costs, delays, outages, stranded assets, and community opposition that AI couples with all data center investments.
• It will cost you, as countries will start to levy tariffs on data center operators and builders.
• With unprecedented growth demands, utilities cannot assume that every proposed data center will arrive on schedule or consume its promised load.
• Expect governments (and the utilities they own or regulate) to impose long-term minimum payments, financial guarantees, energy tariffs, and flexible-load requirements on data center operators.
• A Gallup poll found that 71% of Americans oppose an AI data center being built in their area, with concerns centering on resource consumption, pollution, public costs, and quality of life.

What to take from it

Cloud and colocation costs will become more location-specific, contractually committed, and exposed to power-market risk. Examples include who pays for grid upgrades, how water and emissions will be managed, what enforceable benefits communities receive, and how operators will mitigate noise, traffic, and emergency-response risks. Unlike time‑and‑materials or fixed‑fee models, this approach shifts delivery risk to the provider and [..

Example or evidence

• Data center operators and builders will increasingly need to demonstrate both the technical and socioeconomic metrics of data center impact.
• So what is in stock for 2027 at the intersection of AI, sustainability, energy, and regulations?
• Already, the White House has called on hyperscalers to procure their own power, fund upgrades, and pay for reserved capacity even when unused.
• In 2027, at least two countries will turn this ratepayer-protection principle into tariffs or equivalent obligations.

Details worth keeping

Here is a sneak peek at three of our predictions for 2027: Cloud economics will consequently become more dependent on location, electricity contracts, grid maturity, and providers' ability to generate or reduce power. Enterprises rapidly scaling AI capacity will increasingly inherit these costs.

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