Technological superiority has long been associated with the number of engineers, the size of capital, and the ability to develop software. But the rise of AI adds a less glamorous yet more important element: electricity.

Advanced models need data centers capable of training and running them, and these centers in turn require large amounts of electricity and reliable infrastructure. That is why Tareq Amin, CEO of Humain, considers energy one of the most important advantages Saudi Arabia can leverage as it expands in AI, alongside land, capital, geographic location, and human talent.

But the more important question is not whether Saudi Arabia has energy, but rather: Can abundant energy be transformed into a sustainable economic advantage in the AI industry?

AI: An Electricity-Intensive Industry

Data centers were once viewed as a back-end component of the digital economy. Today, they have become essential infrastructure underpinning AI applications.

The latest data from the International Energy Agency indicates that data center electricity consumption reached approximately 485 terawatt-hours in 2025, and the agency expects it to nearly double to around 950 terawatt-hours by 2030.

Electricity consumption by AI-focused data centers also grew by approximately 50% in 2025, far faster than the growth in data center consumption overall.

This is where the competitive equation changes.

As AI applications expand, countries’ ability to provide large amounts of electricity reliably and at scale becomes increasingly important. This makes energy part of the competitive infrastructure companies seek when building data centers and expanding their computing capacity.

Saudi Arabia’s Advantage Starts with Energy—but Does Not End There

Abundant energy appears to be a clear advantage for a country seeking to build a broad AI industry, but it does not work on its own.

A data center needs a reliable power grid, suitable land, connectivity, cooling, capital, and talent capable of operating this entire system. That is why Tareq Amin highlighted a range of factors including energy, land, capital, geographic location, and human talent.

This matters economically because competitive advantage does not come from possessing a single element, but from the ability to bring these elements together in one integrated ecosystem.

Why Does the Cost of Energy Matter?

In AI, computing costs do not stop at purchasing chips and servers; continuous operation requires electricity, while data centers also need cooling systems and infrastructure capable of handling high and fluctuating loads.

The International Energy Agency notes that the expansion of data centers is already facing bottlenecks in power grids and the supply chains for certain energy equipment. The rising power density of AI servers is also putting pressure on existing infrastructure capacity. The agency indicates that the power density of AI servers increased elevenfold between 2020 and 2025, with further growth expected by 2027.

This means the competition is not only about the price of electricity, but also about the ability to provide it reliably and when data centers need it.

This is where Saudi Arabia can leverage its strengths in the energy sector to build an advantage in technology as well.

When Energy Becomes a Tool for Attracting Investment

This may be the most important economic angle.

Energy is one of Saudi Arabia’s well-known strengths, particularly in oil and gas, but the AI economy opens up a new use for this advantage: attracting investments that require large amounts of electricity.

Rather than being merely a commodity or an input for traditional sectors, energy can become one of the factors that helps attract data centers, cloud services, and digital infrastructure, followed by other activities that develop around them.

This is where the importance of local added value becomes clear.

The economic gain does not stop at building a data center; it is tied to the investments, services, jobs, and activities connected to digital infrastructure that can develop around it.

This is the difference between hosting AI infrastructure and building an economic ecosystem that benefits from it.

Can Energy Create a Lasting Advantage?

An advantage does not become lasting simply because it is available today.

AI itself is evolving rapidly, and software and chip efficiency are improving, meaning that energy consumption per task may decline. At the same time, more complex and energy-intensive applications are emerging, such as video generation, inference tasks, and agentic systems.

The International Energy Agency indicates that future electricity demand from AI will be determined largely by the balance between improvements in efficiency, the pace of adoption, and the emergence of new, more energy-intensive applications.

Therefore, Saudi Arabia’s challenge is not simply to provide more electricity, but to build an ecosystem capable of scaling efficiently and reliably.

The more capable the Kingdom becomes of combining energy, digital infrastructure, capital, land, and talent, the greater its chances of transforming AI from an energy-consuming sector into a driver of new investment and economic activity.

The Next Battle Is Not Only Over Algorithms

From the outside, the AI race may appear to be a competition among companies to develop the best models and chips. But behind this competition lies another battle over more fundamental resources: electricity, data centers, networks, chips, and financing.

The International Energy Agency notes that the race for these inputs has become increasingly evident, with growing bottlenecks in energy, chip supply chains, and electricity equipment, alongside accelerating investment in data centers.

Here, Saudi Arabia holds an important card: energy.

But its true economic value will be determined by the Kingdom’s ability to turn this card into an integrated ecosystem, rather than a standalone advantage.

In the AI economy, the most competitive country may not be the one with only the best model, but the one that can operate AI capabilities at scale, provide the infrastructure and energy they require, and convert that into economic value within its own economy.