Former President Donald Trump is intensifying efforts to shield U.S. consumers from potential increases in utility bills driven by the burgeoning artificial intelligence industry. On Thursday, he encouraged governors and electricity companies to participate in a voluntary pledge designed to prevent data centers from disproportionately burdening households with higher costs.
Trump initially announced this pledge with leading AI and tech companies in March. However, concerns persist among voters already facing affordability challenges, who worry about competition for essential resources like electricity, water, and land with tech firms controlled by wealthy individuals. It remains unclear if consumers will see tangible savings, especially given the already rising electricity demand.
During remarks at the Environmental Protection Agency, Trump urged executives and governors to advocate for data centers in their communities, asserting that areas hosting these facilities would become financially prosperous. "You have to convince your community," Trump stated. "You can’t fight it. You have to go with it."
He added that choosing to embrace the development would ensure the benefits remain domestically. "If you don’t take all that money, somebody else is going to take it. You might as well do it yourselves."
Trump projected that the nonbinding pledge would lead to lower electricity prices, suggesting a surplus of power. Despite uncertainty about whether self-generated electricity from data centers can offset increasing demand, Trump maintained that utility bills, a significant concern for voters, would decrease. "Electricity bills for American families will actually come down," he said. "They’re going to have a lot of electricity left over, and they’ll put that into the grid."
The White House reported that the pledge has been signed by 23 governors and at least 187 companies, including 55 utilities and 27 data center developers. Among the signatories are major utilities like NextEra Energy, Duke Energy, American Electric Power, Southern Co., and Pacific Gas & Electric, as well as data center developers such as Equinix, Digital Realty, and Prologis.
The expansion of the pledge comes as the rapid evolution of AI capabilities presents challenges for governmental oversight. A slowdown in data center construction could hinder economic growth and potentially cede technological advantages to other nations, raising national security concerns. Simultaneously, AI's increasing proficiency in tasks like driving, data analysis, and software development poses a threat to millions of jobs, fueling public resistance to the concentration of wealth among tech magnates.
An analysis by ICF, a consulting and technology services company, indicates that increased electricity demand could lead to a 15% to 40% rise in monthly utility bills by 2030. Opposition to data centers has become a bipartisan issue, with voters concerned about environmental impacts, the use of AI in educational settings, and the potential for data centers to increase community costs and reduce livability. Data center companies argue their facilities contribute tax revenue to school districts and reduce property tax burdens.
Resistance to data centers has surfaced even in traditionally Republican areas, leading to frustration with officials like Texas Governor Greg Abbott, who is among the Republican governors supporting Trump's pledge. In contrast, some state leaders have implemented measures to address these concerns. New York Governor Kathy Hochul issued an order temporarily banning the construction of large server warehouses, and Florida Governor Ron DeSantis signed legislation aimed at preventing utilities from passing data center energy costs to residential and small business customers.
Several state legislatures and utility commissions have begun requiring data centers to cover the costs associated with their electricity consumption, including necessary grid upgrades or new power plant constructions. However, in California, industry representatives have opposed legislation intended to protect consumers from electricity price increases attributed to data centers, according to Matthew Freedman, a staff attorney for the Utility Reform Network.
In a separate development, the White House has expressed concerns that PJM Interconnection, the grid operator for 13 states from Virginia to Illinois, is not adequately ensuring sufficient electricity supply at reasonable prices to meet the demands of the AI boom. White House spokeswoman Taylor Rogers stated that PJM has not implemented a bipartisan statement of principles previously agreed upon by the Trump administration and the region's governors.
Efforts are underway to codify Trump's pledge into law. The House Energy and Commerce Committee has advanced a bipartisan bill that would mandate data centers bear the costs of grid enhancements.