Software could be the easiest fix for hyperscalers' AI power squeeze, researchers say

What happened

The industry is spending billions on more efficient chips, cooling, and grid connections. Data center energy demand is shooting constantly upwards.

The energy crunch is inescapable, and the industry’s answer has largely been to focus on the physical: build more efficient GPUs (a chip built for many calculations at once, used for graphics and AI) and secure more power supply from an already tight grid. Average power usage effectiveness (PUE) has barely changed for six successive years, according to the Uptime Institute’s 2025 survey .

PUE can show whether cooling and power systems are wasteful, but doesn’t account for whether the software running on the servers is doing useful work. And given servers account for around 60% of electricity demand in a modern data center (a building full of computers that runs online services), while cooling ranges from about 7% in an efficient hyperscale site to more than 30% in a less-efficient enterprise facility, focusing on eking out more efficiency from the software side of the equation seems sensible.