Trump Seeks Vows From Tech Firms to Cover Data Center Costs
(Bloomberg) -- President Donald Trump is set to highlight his administration’s efforts to ensure that technology companies’ buildout of energy-hungry data centers won’t raise electricity prices and cause other burdens for consumers.
Trump is expected to reference the plan during his State of the Union address Tuesday night — one of many announcements he plans to make related to the economy, a White House official said.
As part of the effort, Trump administration officials have been pressing technology executives to sign non-binding compacts vowing their companies would cover the cost of power supplies and other necessary infrastructure to support their data center use, said people familiar with the matter who requested anonymity to discuss a plan that isn’t yet public.
The initiative marks the latest step in the administration’s push to address mounting electricity prices and ensure the development of AI — and data centers that support the industry — doesn’t cause huge spikes in power bills.
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Trump previewed the move in a January social media post insisting that while data centers “are key” to the AI boom, the “big Technology Companies who build them must ‘pay their own way.’”
Trump administration officials have been talking with Microsoft Corp., Alphabet Inc. and other companies about signing the pledges, the people said.
The effort marks an attempt to address political and public relations problems tied to the spread of data centers nationwide as technology companies demand more computing power for AI initiatives.
Tech companies are encountering a growing grassroots backlash with activist groups mobilizing to fight the construction of energy-hungry data centers in some regions, citing their demands on local infrastructure, available water and power supplies. A number of jurisdictions, including Atlanta and New Orleans, have imposed restrictions on building new centers.
The issues also pose a political risk for Trump before November’s midterm elections that will determine whether Republicans retain control of Congress. Cost-of-living concerns loom large for voters, and while Trump has touted falling prices for gasoline, power costs have climbed. Those increases have been fed by demand from industrial operations, data centers and increased electrification of home heating, cooking and transportation.
While the promises wouldn’t have the force of law, administration officials believe the formal, public pledges could bring accountability and offer some assurance to consumers worried that the rapid development of AI envisioned by Trump could lead to environmental damage and higher costs.
Separately, the Trump administration also is pressing the nation’s largest power grid to hold an emergency auction allowing tech companies to bid for long-term electricity supplies.
Although Trump vowed on the 2024 campaign trail he’d cut electricity prices in half within 18 months of taking office, consumers’ power bills have instead gone up, climbing well above the pace of overall inflation.
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