Comment by speedgoose
6 days ago
North Norwegians will finally experience higher electricity prices like us in the south experience since a few years.
6 days ago
North Norwegians will finally experience higher electricity prices like us in the south experience since a few years.
On the plus side, a ton of electricity generation capacity is being built for AI datacenters. If this is a bubble and it pops, electricity prices are going to fall faster than you've ever seen before.
Norway is currently building very little new power generation at all, unfortunately. NIMBYism is blocking onshore wind, ecological concerns blocking hydro. This has already started hurting, and is projected to get worse. Before taking any AI datacenters into account.
Electricity prices have a pretty hard bottom that additional supply can't lower. At least where I live distribution is more often the bottle neck than supply.
Same for me, I pay more for distribution fees per month than the kWh generated.
Even if it pops, I think the cat is already out of the bag.
About LLMs: Maybe there won't be much training going around as model we might starting to hit diminishing returns with the current model architectures/approaches, but I believe inference is here to stay. Scaffolding code, trivial functions, ... are things that LLMs excel at doing and once you get used to offload those to the LLM it is really hard to get back to doing it manually.
About Image/Video generations: Here I believe there is even more to explore and I consider this separate from LLMs in the context of AI winters/bubbles. Especially regarding the video generation part.
I am not in the field, but I believe the appeal of being able to create movies without needing xM$ for actors' salaries is huge. And if you can even replace the VFX also with Video Generation then it is a 3 birds with one stone scenario (You pay for AI compute and you replace actors, VFX specialists, and compute costs for render farms).
So, I believe that there is not a scenario in which electricity prices plummet as you describe. Maybe locally around datacenters that were primarily built for LLMs training, but not globally.
> scaffolding code, trivial functions, ... are things that LLMs excel at doing and once you get used to offload those to the LLM it is really hard to get back to doing it manually.
True, but local models cover that use-case very well already and consume little power doing so.
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No, the infrastructure cost would have been paid already and will be recouped on the remaining consumers.
Increasing demand is the only reason anyone every developed more supply. And the future will obviously need more energy production. Development costs money so consumers will pay for it with higher prices but Norway just got new, large consumer to help foot the bill.
I would not hold my breath, Norway is kinda holding back new supply (wind + solar + nuclear) if you compare it to Finland or Sweden.