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John Coogan argues that American energy production is the key metric to watch for…

2026-01-05 · 18:54 UTC ·johncoogan ·3 min read

Brief

John Coogan’s January 2026 post argues that the decisive near-term constraint in AI is not model capability alone but energy production, especially in the US-China competition. Drawing on Dan Wang’s framing that AI is an ongoing process rather than a single race to win, Coogan says America remains ahead but China has kept pace unusually well and is unlikely to fall far behind, even with export controls, because it continues to acquire more Nvidia GPUs and can eventually localize more hardware production. His central concern is that US electricity generation is not scaling fast enough to support ever-larger data centers, neocloud clusters, and hyperscaler buildouts. He contrasts America’s 0.1% annual generation growth from 2008-2021 and EIA projections of 2.4% growth in 2025 and 1.7% in 2026 with China’s 6%+ growth, one-third share of global electricity consumption, and 54% contribution to global demand growth in 2024. He expects energy policy, infrastructure, and investment to become a dominant AI topic through 2026.

Why it matters

John Coogan argues that American energy production is the key metric to watch for the AI competition in 2026, because compute expansion increasingly depends on electricity rather than only model research or product execution.

Key details

  • He frames AI as an ongoing US-China contest rather than a race that can be definitively won in a single year, noting that China has stayed close through the current AI boom and is still expected to receive more Nvidia GPUs in 2026 than in the prior year.
  • The post cites US electricity generation growth of just 0.1% annually from 2008 to 2021, with the EIA’s December 2025 Short-Term Energy Outlook projecting a faster but still modest 2.4% growth in 2025 and 1.7% in 2026.
  • By contrast, Coogan says China has been sustaining 6%+ electricity growth, now represents roughly one-third of global electricity consumption, and accounted for 54% of global demand growth in 2024.
  • He contends the US has mostly been reallocating existing energy toward AI instead of materially expanding supply, though he notes that public energy stocks have surged and startups in the sector are raising hundreds of millions of dollars.
Cleaned source text

author: johncoogan

content_type: twitter_article

published: 2026-01-05T18:54:37+00:00

source_url: https://x.com/johncoogan/status/2008250803417739431

word_count: 587

Even if AI isn’t a race that can be won this year, or any year, and instead is an ongoing process, there are clearly only two real competitors in the arena: the US and China. While America is ahead, China has kept up remarkably well. This might just be a function of how developed the Chinese economy is, or it might be due to the nature of the speed of software development. You can go back and look at how long it took China to catch up in other technologies like cell phone penetration, electric vehicle adoption, even social networking, and it’s not a matter of months, it’s usually years.

But China has been able to stay very close behind throughout the latest AI boom, and there’s no reason to think the gap will widen. They’ll be getting more Nvidia GPUs this year than last year. And even if the US reverses course (again) on export controls, China is good at making stuff and should eventually be able to figure out how to make this particular batch of stuff (gross simplification).

So as America continues to make fundamental research breakthroughs, build ever-larger data centers, and hone ideal AI product user experiences, energy becomes the bottleneck. To date, it feels like America has been just shuffling energy around the board and reallocating resources to AI, but we’re not meaningfully scaling production. I don’t think the 2025 American energy generation data is solid yet, but it doesn’t look like a major break in the graph. To be fair, it’s way up from a baseline of 0.1% annual growth from 2008 to 2021: the EIA’s December 2025 Short-Term Energy Outlook projects generation growth of 2.4% in 2025 and 1.7% in 2026. China, on the other hand, is consistently putting up 6%+ growth. The numbers are actually crazy. China now accounts for one-third of global electricity consumption and contributed 54% of global demand growth in 2024. Stack that up over a few decades and it feels like the “AI future” is basically in the bag.

Something needs to change. Now, we’re not asleep at the wheel. There are lots of companies working on this. Some public company stocks have already mooned. Risky startups that could never get funded a decade ago are pulling in hundreds of millions of dollars. We’re taking the problem seriously, but I’m interested in seeing how quickly things can actually change. As the big AI labs mature (and probably go public), the neoclouds and hyperscalers build ever-larger clusters, and energy prices become more of a political issue, I expect discussions of what we’re doing to make more energy to dominate the conversation in 2026. Let’s get this growth rate up! I’m optimistic it can happen with the right mix of Americans working hard on the problem.

Posted: 2026-01-05T18:54:37.000Z

Engagement: 595 likes, 48 retweets, 15 replies