WSJ Tech News Briefing

Episode: "AI Burns Energy. But Could It Save Even More?"

Date: September 30, 2025
Host: Peter Ciampelli
Guests: Sebastian Herrera (WSJ reporter), Amy Myers Jaffe (NYU research professor), Belle Lynn (WSJ)

Overview

This episode tackles two intertwined stories in tech: the shifting Seattle tech job market amidst major layoffs from giants like Amazon and Microsoft, and the environmental implications of AI’s rising energy demands. While data centers powering artificial intelligence consume growing amounts of electricity and water, research is revealing that AI could help us save even more energy in sectors like transportation, building management, and industrial design. The episode examines whether AI can ultimately deliver an energy net-positive – with insights from Amy Myers Jaffe, a leading NYU research professor.

Key Discussion Points & Insights

1. Seattle's Evolving Tech Economy

Guest: Sebastian Herrera, WSJ reporter
Timestamps: 00:34 – 05:27

• Pandemic Overhiring and the AI Boom

  • Amazon, Microsoft, and other tech giants massively increased hiring during the pandemic boom, expecting continued growth.
  • As the pandemic receded, many companies realized they had overextended, leading to significant layoffs.
  • The surge in AI has further spurred job cuts, as automation replaces certain roles and resources shift toward expensive data center expansion.
    • “AI, as we know, is replacing some jobs like with software development. And also… they are spending billions of dollars on data centers for the AI boom. And this very costly endeavor means that they have to save costs elsewhere.” — Sebastian Herrera (02:28)

• Economic Ripple Effects in Seattle

  • Loss of high-income tech jobs impacts local businesses, commercial real estate, and migration patterns.
  • Notably, more former tech workers are applying for service jobs, such as baristas.
    • “She told me that recently… she started to see people with Microsoft and other tech companies on their resumes applying to become baristas.” — Sebastian Herrera (03:26)

• Seattle’s Transition, Not Decline

  • Despite anxieties, the city isn’t entering a "doom loop" but faces a period of transition, with some laid-off workers launching startups.
    • “People are really figuring it out there.” — Sebastian Herrera (03:54)

• Shifts in Corporate Headcounts & National Trends

  • Even as Microsoft adds new employees and doubles its market cap, overall headcounts aren’t expected to rise—reflecting a trend across tech, not just in Seattle.
    • “There was once a time when Amazon was thought to become bigger than Walmart in terms of headcount, and that no longer appears to be the case.” — Sebastian Herrera (04:33)

2. AI’s Energy Footprint: Cost and Opportunity

Guest: Amy Myers Jaffe, NYU research professor (interviewed by Belle Lynn)
Timestamps: 06:20 – 11:19

AI’s Potential as an Energy Saver

• Offsetting Power Demands
  • While AI data centers use immense electricity, AI could save energy and fuel in other sectors—potentially offsetting or exceeding its own footprint.
    • “You could actually wind up having two to three times the energy we're using to do the AI be saved by applying the AI in critical sectors like buildings, airplanes, container ships, etc.” — Amy Myers Jaffe (07:09)

Application Examples

• Transportation Optimization

  • AI-driven route planning can significantly reduce fuel waste in cars, trucks, airplanes, and ships by minimizing congestion and optimizing deliveries.
    • “Some of the research shows that when we all drive to a mall or to this grocery store or whatever, that uses a lot of fuel. But when we let an Amazon or UPS or FedEx deliver those goods… that can be optimized by a program using AI.” — Amy Myers Jaffe (08:16)
    • Leveraging AI for demand prediction means companies can better stack shipments and reduce emissions from unnecessary over-manufacturing.

• Smarter Buildings and Greener Materials

  • AI systems in buildings adjust lighting, heating, and cooling to match occupancy, saving significant energy.
    • “These buildings now have occupancy sensors and they can calibrate how much air conditioning or lighting or heat system to provide in different rooms at different times…” — Amy Myers Jaffe (09:19)
  • AI accelerates the discovery of sustainable building materials, analogous to its use in drug discovery.
    • “…if you're trying to come up with a composite that could replace cement or make it greener, again, we save a lot of emissions.” — Amy Myers Jaffe (10:01)

Downsides & Cautions

• Privacy & Data Ownership
  • Mass sensor deployment and continuous data collection create substantial privacy concerns, especially as tech companies gain unprecedented insight into daily lives.
    • “Who owns that data, what can happen with that data? That could be a very slippery slope.” — Amy Myers Jaffe (10:26)
• Reliance on AI Accuracy
  • Critical tasks in energy and engineering demand extremely precise AI outputs; small errors can have serious consequences.
    • “…one millimeter of a mistake can be the difference between safely operating infrastructure and an explosion.” — Amy Myers Jaffe (11:02)

Notable Quotes & Memorable Moments

• On the paradox of AI’s energy use:
  “You could actually wind up having two to three times the energy we're using to do the AI be saved by applying the AI in critical sectors like buildings, airplanes, container ships, etc.”
  — Amy Myers Jaffe (07:09)

• On shifting tech job markets:
  “There is a lot of anxiety among tech workers there… but people are really figuring it out.”
  — Sebastian Herrera (03:54)

• On the privacy tradeoff:
  “That could be a very slippery slope… Who owns that data, what can happen with that data?”
  — Amy Myers Jaffe (10:26)

• On the future of tech jobs:
  “No other city in the US rests on two players like Seattle does with Amazon and Microsoft.”
  — Sebastian Herrera (04:50)

Key Timestamps

• 00:34 — Host introduction; Seattle tech layoff context
• 02:04–05:27 — Sebastian Herrera: reasons for layoffs, city impact, changing workforce trends
• 06:20 — Introducing energy and AI with Amy Myers Jaffe
• 07:09–08:53 — AI efficiencies in transportation and distribution
• 09:09–10:16 — AI in smarter buildings and sustainable materials
• 10:21–11:19 — Privacy concerns and risk of over-reliance on AI in critical infrastructure

Episode Tone & Language

The discussion is nuanced but pragmatic: optimistic about AI’s potential for good while clear-eyed about economic transitions and technological risks. Sources speak candidly about the challenges facing Seattle and the energy sector, mixing local anecdotes with broader trends and research insights.

Summary Takeaways

• Seattle stands as a microcosm for broader changes in tech employment and urban economies, shaped heavily by mega-corporations and the AI transition.
• Despite AI’s voracious appetite for energy, its broader deployment could drive massive efficiency gains—if privacy and safety issues are managed with foresight.
• The key future challenge: maximizing AI’s environmental benefits without trading away societal trust or safety.