Event Reflection: AI & Energy - The New Architecture of Emerging Economies

The inaugural session of Future Dialogues, hosted by the Institute for Future, brought together Professor Brian Wong of the University of Hong Kong and Bibek Raj Kandel, Fellow at the Asia Global Institute (AGI), for a focused conversation on artificial intelligence, energy, and the future of emerging economies.

At the heart of the discussion was a timely question: Can AI and renewable energy become critical infrastructure for countries such as Nepal? With strong participation from policy, industry, and academic circles, the conversation examined not only the opportunities presented by these technologies, but also the institutional, policy, and infrastructure conditions required to make them viable.

(i) Nepal to host data centers

Panelists noted that the country's hydropower surplus - particularly during the monsoon season - could position Nepal as an attractive location for compute infrastructure. However, the discussion made clear that affordable, clean electricity generation alone is not sufficient. Reliable transmission and distribution systems are equally important. Significant grid losses, inconsistent supply, and concerns around power quality can undermine the value of energy generated from hydropower or solar sources. A central unresolved question was whether Nepal can provide the near-perfect uptime and dependable power quality required by data centers and other energy-intensive digital infrastructure.

(ii) Small language models

A more practical starting point for Nepal and similar countries than large-scale frontier AI systems. Smaller, locally adapted models could support domestic priorities - such as local-language services, agriculture, education, and public service delivery - without requiring the enormous computing capacity and energy footprint associated with frontier models.

The event aimed to bring together diverse perspectives and raise the questions that will shape future agendas. For countries like Nepal - rich in water resources yet still limited in their ability to translate natural assets into sustained economic and technological value - the intersection of AI and renewable energy presents both a challenge and an opportunity.

The first Future Dialogues session therefore served as an invitation to think beyond immediate constraints. To consider what policy frameworks, infrastructure investments, institutional capabilities, and partnerships will be needed to build an inclusive and resilient future powered by clean energy and AI.