Trump pushes big tech to use own power for AI data centers to keep bills low

President Trump is working with big tech companies like Amazon, Google, Meta, Microsoft, xAI, Oracle, and OpenAI to make them generate their own electricity for AI data centers. A meeting is planned in March at the White House where these companies will formally sign a pledge to manage their own power supply, as posted on X by The Kobeissi Letter. The companies have agreed to protect Americans from electricity price hikes while building or buying their own energy for new AI data centers.

Trump highlighted this in his State of the Union speech, saying tech firms must provide for their own energy so normal people’s bills don’t rise. He called it the “ratepayer protection pledge.” Trump’s team says this move also responds to voter concerns over rising electricity costs, which could affect elections. AI data centers use huge amounts of power, sometimes as much as a small city, requiring big upgrades like new power plants and transmission lines, as stated by NYT.

Tech companies to pay for power

Normally, utilities pass the cost of these upgrades to all customers, which can cost billions, but now politicians are asking tech giants to cover most of it. Some companies, like Microsoft and Anthropic, already promised to pay higher electricity rates to cover data center costs. Companies like Meta are building their own power plants, often using natural gas, like Meta’s data center in El Paso, Texas.


Google’s Briana Kobor said the company wants to pay its fair share for all energy costs at a recent utility regulator meeting. Experts say if tech companies cover all infrastructure costs, it could lower electricity costs for everyone, but it’s complicated to do in practice. Challenges include deciding which costs to assign to data centers and the secrecy of contracts, making it hard to verify if companies pay all costs.

Smaller third-party developers building data centers might not be covered by these pledges, creating uncertainty. Energy Secretary Chris Wright said all major data center developers are in dialogue with the administration. The companies expected at the signing include Amazon, Google, Meta, Microsoft, xAI, Oracle, and OpenAI, as cited by Fox News. Josh Levi, from the Data Center Coalition, said tech companies will work closely with the government to keep the grid reliable and affordable.

Critics say pledges not enough

Some Democrats and environmental groups criticized the pledges as symbolic, saying they don’t guarantee lower energy bills. Senator Mark Kelly said a handshake deal isn’t enough; Americans need real guarantees on electricity prices. The Energy Department announced a $26.5 billion loan to Georgia Power and Alabama Power to build new gas plants, upgrade nuclear plants, and improve transmission lines, as noted by NYT. The loan will allow a three-year rate freeze for Georgia Power customers as data centers expand.

The administration also floated a plan in the PJM Interconnection region to have tech companies pay to build power plants under 15-year contracts, but it could take years to work. Rising electricity prices have become a political issue, with prices rising faster than inflation in about 24 states over six years. Some analyses show that new data centers can even lower costs by spreading grid maintenance costs among more users.

At least 25 planned data centers were canceled last year due to local protests. Experts say tech companies are now acknowledging they need to pay more, after previously claiming they already paid enough. Trump previously promised to cut electricity bills in half within 18 months, but now says energy costs will fall soon to numbers “few people would believe.”

FAQs

Q1. Which tech companies signed the electricity pledge with Trump?

Amazon, Google, Meta, Microsoft, xAI, Oracle, and OpenAI are joining the pledge.

Q2/ Why is Trump asking tech companies to provide their own power?

To protect Americans from higher electricity bills caused by big AI data centers.