Trump makes AI firms pay for power

Big tech giants and AI companies have pledged to pay for the cost of energy generation infrastructure required to power their massive data centres – a move aimed at keeping electricity prices from rising in the US and reducing backlash against such projects in local communities.

A race to build infrastructure to enable AI has strained aging US grids and supply, sparking concerns that electricity costs could rise significantly, exacerbating the ongoing cost-of-living crisis.

If successful, the agreement between the US government and the companies will see those costs shouldered by tech giants and AI developers, rather than foisted onto local communities and businesses.

"This means that the tech companies and the data centers will be able to get the electricity they need, all without driving up electricity costs for consumers," ​Trump said at the pledge signing event, according to Reuters. "This is a historic win for countless American families, and we'll also make our electricity grid ​stronger and more resilient than ever before."

With US midterm elections looming in the autumn, American president Trump seems keen to ensure the costs of AI, in particular around electricity prices rises, won't become a bigger problem. Data centre projects around the US have faced pushback from local communities over environmental, pollution, water use and related issues.

"Some data centers were rejected by communities for that, and now I think it's ​going to be just the opposite," Trump said per Reuters.

What they're signing up for

The Ratepayer Protection Pledge was signed at the White House and included Amazon, Google, Meta, Microsoft, and Oracle, as well as OpenAI and xAI. Anthropic was not included in the pledge, perhaps unsurprising following a high-profile disagreement with the US government over military uses of its AI.

According to a White House document, the signatories will need to "build, bring or buy the new generation resources" required to power data centres, covering all costs – and, where possible, adding additional capacity to benefit the wider public.

Beyond that, the tech companies will need to cover the costs of all new power delivery infrastructure upgrades and negotiate new rate structures, with the White House stressing that applies whether the company ends up using the electricity or not.

The pledge also requires tech companies to invest in local communities when building data centres and to work with grid operators to make their own backup generation resources available during blackouts to help local residents.

Will it work?

But, critics noted, the pledge may not do enough to boost supply – especially in time for November's elections. Jon Gordon, a director at Advanced Energy United, told Reuters: "The real problem is the inability to get generation online ⁠fast enough ​to meet the data center demand. Hyperscalers paying for the generation doesn't get it ​online any faster."

That said, a White House official told Politico that the work started months ago: "These negotiations have been going on for months. We've already seen things moving in this direction. This is, in a sense, formalizing and having all of the large developers formally commit to practices they've already been migrating towards, through cooperation with the administration."

Indeed, while Trump has forced the tech companies to make a public pledge on these issues, many were already attempting to win over local communities via similar efforts. For example, Google last week announced a data centre that wouldn't use any water – outside of the kitchen, at least – and has previously said it would offer its resources to local communities in case of blackouts.

More widely, tech companies have turned to new sources of energy generation, including geothermal and nuclear. Elsewhere, data centres have been built alongside housing, with the excess heat from the former used to offer free heating to the latter – but that takes time to plan and execute, something in short supply amid the AI race.

The US efforts come alongside wider pushback from governments regarding the impact of AI data centres, with UK campaigners hoping to encourage the British government to include environmental impact assessments and other protections in planning permissions for such projects.