How DeepSeek is Changing the Need for Energy

Many thought the AI boom would burn through massive amounts of energy.

They expected power companies, investors, and tech firms to brace for a surge in electricity demand.

But China’s DeepSeek AI proved them wrong.

It showed that AI models can be trained with much less energy than people thought.

Why should this matter to you as a tech professional?

Because you need to explain AI developments clearly in meetings and reports.

You must use sharp, precise language to describe these changes.

In this issue, I'll summarize the article and explain the key terms

Here’s a key excerpt from the February 7th, 2025 issue of The Wall Street Journal

"DeepSeek, a generative AI model trained using substantially less energy than its American competitors, routed tech and power company shares last week, eroding stock gains spurred by projections of data center growth. Now, the companies planning to power those data centers are grappling with the prospect that AI may become much more energy-efficient and fast."

What should professionals make of this?

• AI’s growing efficiency could cut the long-term need for new power plants.
• This shift will force changes in business strategies.
• Investing in power infrastructure might not bring the profits people expected.
• Business leaders need to talk about AI’s impact on energy demand clearly and precisely in business settings.

Key Vocabulary with meanings and context

These words will help you speak and write about AI and energy in business environments.

1. Substantially (adverb)

Meaning: To a large extent; significantly.

Context from the article:

"DeepSeek, a generative AI model trained using substantially less energy than its American competitors..."

Explanation: “Substantially” shows that DeepSeek used much less energy than other models—a big difference.

Example: "Our company has substantially reduced its cloud storage costs by optimizing data usage."

2. Routed (verb)

Meaning: To defeat completely or cause a dramatic failure.

Context from the article:

"DeepSeek... routed tech and power company shares last week..."

Explanation: Here, “routed” means DeepSeek’s success caused tech and power company stocks to drop sharply, as if beaten in a contest.

Example: "The new software update routed competitors in the market due to its advanced features."

3. Eroding (verb)

Meaning: Gradually weakening or reducing something over time.

Context from the article:

"Eroding stock gains spurred by projections of data-center growth."

Explanation: “Eroding” means the stock gains are slowly disappearing because new data about AI’s energy efficiency changed investor expectations.

Example: "High maintenance costs are eroding the company’s profit margins."

4. Spurred (verb)

Meaning: To encourage, trigger, or cause something to happen quickly.

Context from the article:

"Stock gains spurred by projections of data-center growth."

Explanation: “Spurred” means that predictions about data center growth caused stock prices to rise.

Example: "Strong demand for electric vehicles has spurred new investments in battery technology."

5. Grappling (verb)

Meaning: Struggling to deal with a difficult situation or problem.

Context from the article:

"Companies... are grappling with the prospect that AI may become much more energy-efficient and fast."

Explanation: “Grappling” means companies are struggling to adjust to the idea that AI will be more energy-efficient, which may affect their strategies.

Example: "Many tech firms are grappling with the challenges of remote work and cybersecurity threats."

Try this practice exercise yourself:

1. Our team has __________ improved system performance with the new update. (Hint: means significantly.)
2. The unexpected market shift __________ several small companies. (Hint: means defeated.)
3. Rising costs are slowly _________ our competitive advantage. (Hint: means reducing.)
4. New AI breakthroughs have __________ interest in sustainable tech. (Hint: means triggered.)
5. Companies are __________ with how to adapt to rapid AI developments. (Hint: means struggling.)

Reply with your answers in the comments if you'd like feedback!

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