AI and data centers redefine energy transition after five years

The AFPM Summit 2026 it reviewed the main clean energy initiatives developed over the past five years and identified the growth in electricity demand linked to artificial intelligence as one of the next major challenges for the energy sector.

The energy transition it is now entering a stage marked by greater capital discipline, supply chain constraints, and increasing competition for electricity, equipment, and skilled labor.

During the AFPM Summit 2026, held in Grapevine, Texas, industry specialists analyzed the performance of technologies such as renewable diesel, hydrogen, carbon capture and sustainable aviation fuel (SAF).

The meeting brought together about 1,500 professionals from the refining and petrochemical sectors, one of the sessions focused on comparing the expectations that existed five years ago with the results achieved up to 2026.

The energy transition yields uneven results

During the panel, Daniel Orr of Worley Consulting reviewed how the allocation of capital in the energy sector has changed over the past decade. Before the pandemic, investments were primarily focused on improving facility performance and increasing margins under traditional market conditions.

Subsequently, state and federal incentives began to more strongly promote the clean energy projects, a trend that accelerated after the pandemic.

According to the data presented during the session, by 2025 approximately 65% ​​of investments in the energy sector were directed towards clean energy, while approximately 35% remained linked to fossil fuels.

For her part, Meaghan McCaffrey, of 1898 & Co., a Burns & McDonnell firm, compared the expectations that existed in 2021 with the results observed five years later.

Among the technologies that best met these projections were renewable diesel and renewable natural gas. One of their main advantages was the ability to leverage existing infrastructure, such as pipelines, terminals, and storage systems. This compatibility allowed them to accelerate their market entry and take advantage of available incentives more quickly.

Hydrogen and ammonia fall short of expectations

The picture was different for hydrogen, numerous projects announced in the United States suffered delays or were canceled, while blue and green ammonia initiatives faced similar difficulties.

McCaffrey noted that, of approximately 80 ammonia projects of those that had been followed, only a few were eventually built.

Carbon capture showed more visible progress, although at a slower pace than initially anticipated, the main obstacles included permitting processes and the need to develop infrastructure to transport CO₂.

The experience gained over the years is changing how companies evaluate new investments, projects will need to demonstrate sufficient regional demand, sound economic fundamentals, and realistic implementation conditions before moving toward a final investment decision (FID).

Capital discipline returns to the center of decision-making

Based on the observed results, the specialists advocated for a more selective implementation of clean energy projects. The existence of tax incentives alone does not guarantee that an initiative will have the necessary conditions to be implemented.

Planning should also incorporate logistical risks, raw material supply, and purchase agreements further in advance. Orr suggested that logistical studies, risk assessments, and supply agreements should be carried out during the early stages of the project, ideally between six and eight weeks after its start.

This approach would allow for the identification of critical problems before presenting a proposal to a board of directors or committing large amounts of capital.

The panel also warned that the incentives have attracted companies with very different technical and financial capabilities. Large multinationals and small operators can compete for the same benefits, even though their actual chances of completing the projects are very different.

AI and data centers increase electricity demand

One of the topics that generated the most attention during the session was the rapid growth of the artificial intelligence and data centers. The expansion of this infrastructure is changing the conversations about new energy projects due to its high electricity requirements.

According to participants, energy availability and purchase agreements are already part of the discussions with customers from the earliest planning stages.

It also increases the importance of understanding the actual capabilities of original equipment manufacturers (OEMs). Developers need to assess suppliers’ track records and their position within supply chains before committing to construction schedules.

Adding to these limitations is the availability of skilled labor, construction teams must be divided between new data centers and traditional refining and petrochemical projects, a competition that could become another bottleneck for the execution of new investments.

The SAF maintains a gap between demand and production.

He sustainable aviation fuel it also showed results below projected targets, despite the high air traffic recorded in the United States during the summer of 2026.

One of the main differences compared to renewable diesel lies in the policies designed to guarantee demand. Renewable diesel is backed by federal blending obligations associated with the Renewable Volume Obligation (RVO). SAF, on the other hand, does not have an equivalent mechanism to generate a demand signal of the same magnitude.

Airlines remain interested in using sustainable fuels, and refineries have the capacity to produce them, however, the lack of a comparable mandate makes it difficult to reach the volumes that had been projected for this market.

The next stage will depend on demand, supply, and execution

The experience of the last five years shows that having technology and incentives is not enough to guarantee the success of an energy transition project. Regional demand, equipment availability, logistics, skilled labor, and capital discipline will play an increasingly important role in investment decisions.

Added to this scenario is now artificial intelligence, the growth of data centers opens new opportunities for the energy sector, but also increases competition for electricity, transformers, compressors, suppliers and specialized personnel.

Looking ahead to the new investment cycle, the vision put forward by specialists points towards a more cautious scenario, in which projects will have to demonstrate their viability more clearly before receiving capital.

Source: HP Hydrocarbon Processing

Photo: Shutterstock