Jensen Huang says AI data centers can fix the very grid they’re straining

Nvidia CEO Jensen Huang has stated that the AI industry must improve its relationship with local communities regarding the construction of data centers. In an interview with CNBC's Jim Cramer, Huang emphasized the need for the technology sector, including Nvidia, to actively engage with communities and demonstrate their commitment to addressing concerns surrounding data center development.

Huang pointed out that recent polling indicates a significant level of skepticism among Americans towards the construction of data centers. He suggested that the industry should focus on selling the idea that building these facilities can aid in the reindustrialization of the nation. Furthermore, Huang argued that data centers have the potential to contribute to lower energy costs and the improvement of the energy grid, as well as the securing of energy supply, thanks to the substantial market dynamics and forces at play.

Recent studies, such as one conducted by researchers at the Massachusetts Institute of Technology, have shown that data centers can actually reduce consumer costs by adjusting their power consumption to off-peak hours. The researchers found that shifting power consumption to non-peak hours in the Mid-Atlantic, Texas, and 11 western states could lower average energy costs by up to 4%, 5%, and 2%, respectively, compared to facilities that do not make such adjustments.

However, the researchers also warned that in certain scenarios, data centers might need to consume nearly 50% of their energy during off-peak hours, such as the afternoon. Nvidia reported that its data center revenue reached $89 billion in the second quarter of FY 26, surpassing Wall Street's estimates and highlighting the immense profitability of the AI industry.

Despite the growth in data center revenue, Huang warned of the potential costs to the US if the industry does not continue to build out data centers, stating that American communities must embrace this technology to capitalize on its benefits for the economy and society.