Copper is vital to support the rapid growth in data centres around the globe that are enabling us to embrace new artificial intelligence (AI) and generative AI (GenAI) technology. This explainer looks at why copper is important to this emerging technology and the growing impact AI and data centres are expected to have on global copper demand.

For more information, visit our blog: ‘BHP Insights: how copper will shape our future’.

AI and GenAI tools are transforming the way we work, create and interact. Whether it’s Microsoft Copilot, OpenAI’s ChatGPT, Google’s Gemini and Dall-E or the incorporation of AI functionality in already widely used applications such as Microsoft’s Word and Adobe’s Photoshop, interest has boomed in recent years.1

AI-powered voice assistants have become increasingly popular among consumers, but there has also been a surge in interest from large enterprises in using AI to solve business problems.

It’s easy to understand why. These exciting AI tools offer potential efficiency gains in our work, in managing our daily lives, and can help us explore and develop new concepts and ideas.

But for all their strengths, they are only as good as the processing power behind them. In this partnership, AI technology may be the brains, but data centres provide the brawn.

AI-powered tools require super-fast data processing and data storage and retrieval capability to handle the resource-intensive training and deployment of the complex machine learning models and algorithms that make them work. Data centres provide this rapid computational muscle.2

Data centre construction had been rising over the past decade to support the growth in digitisation and cloud computing. In the past two years though, construction has doubled in the United States, according to the International Energy Association (IEA)3 (see chart below) as major players such as Amazon, Alphabet and Microsoft invest heavily to try and stay ahead of the AI-driven demand.

Other countries such as China, Japan and the European Union have also experienced an increase in data centre construction. For example, in April 2024 Microsoft announced a US$2.9 billion investment over the next two years in data centres in Japan to boost its AI and cloud infrastructure, after having committed US$3.2 billion over three years in November 2023 for data centre construction in the UK.

Where does copper come into this equation? Well, data centres require vast amounts of copper for their construction, particularly for their power networks, circuit boards and cooling systems. A study of Microsoft’s US$500 million data centre facility in Chicago found it used 2,177 tonnes of copper, equivalent to 27 tonnes of copper for every megawatt (MW) of applied power.4

Data centres also need large amounts of power to function. Both the generation of this power and its delivery to the data centre require copper. According to the IEA,3 large hyperscale data centres, which are becoming increasingly common, have power demands of 100 MW or more, an annual electricity consumption equivalent to that used by around 350,000 to 400,000 electric cars.

The technology majors have been scrambling to lock in low greenhouse gas (GHG) emissions electricity to feed their burgeoning power-hungry data centre assets. In September for example, Constellation Energy announced its intention to reopen the Unit 1 reactor at its Three Mile Island nuclear power plant, near Harrisburg, Pennsylvania, with the move underpinned by a new electricity supply agreement with Microsoft seeking low GHG-emissions electricity supply for its growing data centre assets.

So copper is not only used in data centre construction, it is important in the facilities that generate power for them and in the infrastructure that delivers this power to them. And with investment in data centre construction rising rapidly, this is becoming an emerging demand driver in the global copper market.

This emerging trend was highlighted in our recent ‘BHP Insights: how copper will shape our future’ blog, where, as part of a broader copper discussion, we looked at how ‘digital’ will boost global copper demand over the coming years. ‘Digital’ demand refers to the growth in demand for copper as the world creates and consumes massive amounts of data, enabled by copper-hungry data centres.

We estimate the copper used in data centres globally will grow six-fold by 2050 – from around half a million tonnes a year of copper today, to around 3 million tonnes a year by 2050. That uplift is roughly equivalent to the combined annual output of the world's four largest copper mines today.

We also expect global electricity consumption from data centres to rise from around 2 per cent of total global electricity demand today, to 9 per cent by 2050. In some countries this proportion is already higher – for example in Ireland, data centres already represent a fifth of the country’s total electricity consumption.3

We are not alone in these kind of electricity forecasts. The IEA is expecting something similar. But as the IEA reports,3 despite this growth, data centres will still not be the dominant driver in the global electricity market: “While growing digitalisation, including the rise of AI, is one factor, continued economic growth, electric vehicles, air conditioners and the rising importance of electricity-intensive manufacturing are all bigger drivers,” it says.

Even so, the impact of AI on data centre growth and power consumption remains significant – and that’s why people are now talking about ‘digital’ in relation to copper demand too.

For more information and our projections on global copper demand, read our blog ‘BHP Insights: how copper will shape our future’.

What is a data centre?

A data centre is a physical facility that houses many computer servers connected through high-speed networks that allow for parallel processing and super-fast processing times. It enables the rapid collection, processing, storage and retrieval of data required to effectively process complex AI machine learning algorithms.

Data centres must be ready, available and capable of super-fast processing and data storage and retrieval, 24/7.

To do this, these centres require the latest computer chips housed in server units such as the new Nvidia GB200 NVL72, which was launched in 2024 and includes the Blackwell B200 GPU (graphics processing unit), described as the world’s most powerful chip.5 This new chip is claimed to have four times the AI processing capability of its Nvidia predecessor6 and Nvidia itself is estimated to have had a 98 per cent share of the data centre global GPU chip market in 2023.7 The new GB200 unit has over 5000 copper cables totalling over 3.2 kilometres in length.8

A data centre brings many hundreds of these units together to provide next-level data processing and storage capability.

Why is copper important to data centres?

Copper is used in many areas in a data centre, including:

In the chips, wiring, busbars and power connectors in the servers themselves
In the cooling systems in the servers and for the data centre
For the transmission cables and power connections across the data centre
For the external cabling to deliver power to the data centre
In the infrastructure used in generation of the power required to run them, particularly if this power if from sources such as solar or wind farm.
Hands in gloves holding copper


Caption: Producing copper cathode at BHP Escondida, Chile. This high-quality material is prized for its electrical conductivity.

Data centre construction surges

Data centre construction had been increasing before the latest AI-driven demand. Between 2018 and 2023 the number of hyperscale data centres worldwide doubled (from 448 to 992).9 This data centre demand was driven by the computational applications, storage consumer applications (such as Netflix) and ongoing enterprise adoption of cloud.

For example, when your phone backs up to the cloud, it is essentially storing the information in a data centre or a range of data centres somewhere around the globe for whenever you next need it.

But AI requires 10 times the resource requirements of the cloud, according to Macquarie Data Centres.2 The rapid embrace of AI in the past couple of years has resulted in a surge in investment in data centres as this table from the IEA shows.

Investment in data centres in the United States, January 2014 to August 2024

(Y axis: Dec 2019 = 1)

Graph showing investment in data centres



Sources: IEA analysis based on data from US Census Bureau

IEA (2024), Investment in data centres in the United States, January 2014 to August 2024, IEA, Paris https://www.iea.org/data-and-statistics/charts/investment-in-data-centres-in-the-united-states-january-2014-to-august-2024, Licence: CC BY 4.0

Footnotes:

1 22 Top AI Statistics & Trends In 2024 – Forbes Advisor – Oct 2024
2 What is an AI data centre and how does it work – July 2024
3 What the data centre and AI boom could mean for the energy sector – Analysis - IEA – Oct 2024
4 Why Copper Is Critical for Data Centers – Visual Capitalist – Oct 2023
5 Nvidia reveals Blackwell B200 GPU, the ‘world’s most powerful chip’ for AI – The Verge – May 2024
6 Nvidia’s next-gen AI GPU is 4X faster than Hopper – Tom’s Hardware – March 2024
7 Nvidia shipped 3.76 million data centre GPUs ion 2023 – dominates business with 98 per cent revenue share – Tom’s Hardware – June 2024
8 Taking a closer look at Nvidia’s DGX GB200 NVL72 beast – The Register – and March 2024
9 Hyperscale data centers worldwide 2023 – Satista – June 2024

For more information, visit our blog: ‘BHP Insights: how copper will shape our future’

To find out more about how copper deposits have become increasingly challenging to locate and extract, visit our blog: ‘Visualised: Major Copper Discoveries since 1990’

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