Meeting the historic escalation of U.S. electricity demand led by data centers will require wind and solar power that President Donald Trump is steering the nation away from, energy executives and members of Congress said during a POLITICO Energy Summit in Washington on Tuesday.
“If it’s not renewables, what’s it going to be?” said John Ketchum, CEO of NextEra Energy, the Florida-based power company.
But the argument that renewables and battery storage can be deployed has not moved the White House from an agenda that pins the electric grid to coal and natural gas and reverses course on clean energy technology. At the POLITICO summit, industry executives and members of Congress said the approach to energy backed by Trump and conservative Republicans is making it harder to power Silicon Valley’s AI tech companies as they race against China.
“The president is in charge,” said Jarrod Agen, director of the National Energy Dominance Council created by Trump. “The president has not focused on wind and solar.”
Some speaking at the POLITICO summit lamented that Trump’s aversion to sources other than fossil fuels and nuclear reactors undermine another Trump goal: lowering energy prices.
“We’re in a constrained supply environment and an increased demand environment,” said Senate Energy and Natural Resources Committee ranking member Martin Heinrich. “People’s electricity bills all over the country are going to go up. What I can guarantee you is in the next election and the election after that Republicans are going to own increased energy prices.”
Utah Republican Sen. John Curtis said changes should be made to a House-passed tax, energy and security bill that would quickly phase down investment and production tax credits included in the Democrats’ 2022 climate law — potentially leading to the cancellation of major energy and industrial projects.
“Investors have invested billions of dollars based on the rules of the road, and you have employees who have set careers based on these things,” Curtis said.
If the U.S. wants to be energy dominant, Curtis said, “let’s not crush any of it.”
The tech industry on Tuesday also urged Republicans to make specific changes to the megabill now in the Senate. In a letter to Senate Majority Leader John Thune (R-S.D.), the Data Center Coalition — a trade group that includes Microsoft, Google, Amazon Web Services and others — called for a “pragmatic approach” to help power data centers.
“As demand for data center services continues to rise, timely access to affordable and reliable power is and will continue to be the pacing challenge for the industry,” said the letter. “With thoughtful and targeted changes to [the legislation], the U.S. can maintain its leadership in AI, while simultaneously committing to long-term fiscal responsibility.”
The tech industry letter calls for extending the time companies have to receive “tech-neutral” tax credits. Under the Inflation Reduction Act, many of the credits could be claimed through 2032. But even with the support of moderate Senate Republicans, it’s unclear how much can be put back into the House bill as congressional leaders push for passage by next month.
Meanwhile, since taking office, Trump has ordered aging coal- and gas-fired power plants to stay open. “We need to keep those functioning until we get the rest of the resources on line,” said Rep. Brett Guthrie (R-Ky.), chair of the House Energy and Commerce Committee.
Trump has directed DOE to analyze the impact of plant closings on electric reliability, a prelude to more emergency orders to keep them running. NextEra’s Ketchum said keeping coal plants open for longer wouldn’t “make a dent” in the demand coming from data centers, advanced manufacturing, electric cars and other segments of the economy.
A report by DOE’s Lawrence Berkeley National Laboratory in December estimated that data center demand could climb to as high as 12 percent of total electricity use in 2028 — almost tripling what it is today. Other estimates have put overall U.S. electricity demand rising by as much as 25 percent by 2030.
Natural gas has been a focus of the administration. But that’s also not a short-term solution to demand growth.
Scott Strazik, chief executive of GE Vernova, which builds large gas turbines, told an investor conference last month that the company’s order book for turbines for delivery in 2028 is filling up and other orders are geared toward 2029 and 2030. The price of those gas turbines has also gone up significantly.
New nuclear plants, another option for data center power, is much further out.
U.S. technology leaders, committed to reducing the impact of their data centers on greenhouse gas emissions, say they’ll power gas centers with natural gas but also invest in renewable power to offset their carbon emissions.
John Bistline, senior program manager at the Electric Power Research Institute, said in an interview that slashing tax incentives for clean energy projects could cut investment by as much as half. But he said deployment of wind and solar along with storage would grow but at a slower pace.
Analysts have not worked out how heavy tariffs on steel, aluminum and other energy infrastructure components would impact generation expansion.
