The White House’s full-court press on fossil fuel-friendly policies is causing friction with the electric utilities that power America.
It’s a clash months in the making, and one that could frustrate a range of major initiatives that affect hundreds of millions of Americans.
The Trump administration has been tearing down Biden-era energy programs and aiming to quickly deliver a dramatic overhaul to the U.S. electricity grid. It wants to jump-start a fleet of artificial intelligence data centers, keep fossil fuels on the electricity grid, boost next-generation nuclear reactors and stabilize electricity prices.
Electric utilities, meanwhile, are slow-moving machines that operate on the five- to 10-year planning cycles that are necessary to make sure there’s enough electricity for U.S. households and businesses.
“Utilities are trying to make investments in 60-year assets. If one administration does a 180 from the previous administration, it’s nearly impossible for utilities to make any such investments,” said Rob Gramlich, founder of the Grid Strategies consultancy.
The universe of utilities, which run the power lines and grid infrastructure that turn the lights on for Americans, is large and diverse. Some companies are private; others are publicly owned. They represent different geographies and different resource portfolios.
But according to interviews with 10 energy insiders, some of whom were granted anonymity to speak freely about private interactions with the White House, many utilities are concerned with the Trump administration’s push for hyperscalers to secure off-grid power and its use of emergency orders to keep fossil fuel plants running.
While utilities applaud the administration’s push for more electricity and permitting reform, some executives bristle at the administration’s anti-renewables policies, which include cuts to hundreds of millions of dollars in utilities grants from the 2021 bipartisan infrastructure law and early expiration of tax credits in the Inflation Reduction Act.
All of that comes as utility bills skyrocket across the U.S. Utilities have requested or received approval for roughly $34 billion in rate hikes through September, according to a new report from the nonprofit PowerLines. Nearly 200 million Americans face higher utility bills, the study said.
In a message on Truth Social in October, President Donald Trump said electricity prices are on the ballot in gubernatorial polls Tuesday in New Jersey and Virginia.
“If you vote Republican, your Energy Costs are going to go down, tremendously!” Trump said. “If you vote Democrat, your Energy Costs are going to go ‘through the roof,’ making Energy virtually unaffordable for you and your family to pay.”
Democrats are also embracing electricity prices as a campaign issue.
Meanwhile, the U.S. faces an electricity demand surge unseen in a generation. Some analysis suggests demand could spike 50 percent by midcentury.
“For 30 or 40 years, electricity issues seemed rather dull. Many utilities had no real load growth,” said Theresa Pugh, a veteran energy industry consultant. “Now, there’s this perfect storm of ‘how fast can we build new manufacturing, semiconductor plants and data centers — all at the same time.’ I never in my lifetime expected electricity demand to increase the way it’s expected to.”
Spiking electricity demand
Much of the projected demand increases are driven by artificial intelligence data center projects. The Trump administration routinely says the U.S. must win the AI race with China; Energy Secretary Chris Wright has called AI the “Manhattan Project of our time.”
“Every megawatt of electricity is necessary to power the AI arms race, especially after Joe Biden’s Green New Scam forced power plants into retirement before the end of their useful life,” White House spokesperson Taylor Rogers said in a statement.
But that demand is likely to spike bills, according to a range of analyses. To placate concerns about the impact of AI demand on consumer electricity bills, Trump, speaking at the White House recently, said data center developers are “building their own electricity,” a situation sometimes referred to as power co-location.
“They’ve become a utility, in a sense,” Trump said. “We’re letting them build their own electricity so we don’t have to worry about the grid.”
DOE is asking industry for advice to address the projected increase in demand — and the Edison Electric Institute, an influential lobbying group representing for-profit utilities, says it’s collaborating with the White House.
“We’re working regularly with officials across the Administration and share the same goals of making the grid more reliable and energy more affordable,” EEI President Drew Maloney, who served at the Treasury Department in Trump’s first term, said in a statement.
Still, many electricity experts say relying on off-grid power at data centers is impractical. Redundancy is needed in case of a disruption at a plant. And the grid helps to modulate electricity to help data centers run smoothly.
Some utility experts view the White House grid plans as a financial threat.
“For some utilities, co-location presents some concerns to the business model,” said a lobbyist who represents companies that oppose emissions regulations and was granted anonymity to speak freely. “The challenge is that the utility sector is on a five- to seven-year buildout schedule for any significant amount of generation, and the AI sector is in an 18-month demand cycle.”
The Trump administration, staffed heavily by oil and gas industry leaders, is short on utility veterans. Wright, for example, led hydraulic fracturing services company Liberty Energy before his confirmation to the Cabinet. A lobbyist with close ties to the administration said fossil fuel companies want to sidestep utilities to power data centers.
“The biggest conflict that’s emerging is the friction between the utility model and the oil and gas business model for these larger companies that want to get into the merchant power business of supporting data centers,” the lobbyist said. “The oil and gas folks say these guys are trying to stop us from innovating and keep us out of their market because they see us as an existential threat to their business model. And the White House is very sympathetic to that.”
For now, the industry is looking to the Federal Energy Regulatory Commission, an independent agency, to nail down rules for data center co-location. Wright is calling on FERC to also craft rules on data center interconnections to the grid. He floated measures that include prioritizing projects that commit to curtailing consumption during peak demand.
Capstone, a consultancy, said recently that Wright’s directive to FERC is “largely negative for investor-owned utilities … which will likely fight to ensure states retain jurisdiction over large load interconnection processes.”
To make matters worse, utilities and hyperscalers don’t have much experience together, according to some in the industry.
“Utilities and technology companies still don’t speak the same language, and now we’re all in the same sandbox,” said Richard Ward, a senior policy adviser at Venable and a former lobbyist for EEI. “Collaboration isn’t optional anymore; it’s the only way forward.”
On top of that, many of the policies that directly determine electricity rates take place at state-level utility commissions.
“The hardest part is that most of this plays out at the state level. Washington can set the tone, but it can’t just flip a switch and solve everything overnight,” Ward said. “The federal government needs to stay focused on the looming energy supply gap. The shortfall everyone’s projecting isn’t theoretical—it’s coming fast.”
Renewable opposition and fossil fuel fiat
The Trump administration earlier this year tried to halt work on the 80 percent-complete Revolution Wind farm offshore of Rhode Island, and it has threatened to derail more wind projects.
And last month, the Trump administration canceled a review for a major solar project in Nevada that was approved by the Biden team. Across the board, the administration is frustrating permits for wind and solar farms on public lands.
Yet utilities in recent years have dramatically boosted plans for renewables. Solar accounted for more than half of electricity capacity added to the grid in the first half of 2025, according to an influential solar association. Batteries, meanwhile, are likely to account for roughly a quarter of all grid installations this year.
“Whether any given utility loves or hates renewables, most of them are relying heavily on renewables and storage for a large part of their portfolios to meet demand in the 2020s,” said Gramlich of Grid Strategies.
Experts in the energy sector fear a Democratic backlash in the future.
“There’s also the trepidation that eventually, at some point, Democrats will be back in the majority. Would we really want them doing the same thing to baseload or dispatchable resources?” said another energy lobbyist.
Meanwhile, the Department of Energy this year deployed emergency powers to keep a set of fossil fuel plants running, arguing the power is needed to stave off blackouts.
DOE, for example, ordered the Michigan utility Consumers Energy to continue operating the J.H. Campbell coal plant until at least Nov. 19, even though Consumers said the emergency order raised net costs at least $80 million this year.
Speaking on the sidelines of the United Nations General Assembly in September, Wright said utilities support the emergency orders.
“Now we’re just talking with utilities,” he said. “More utilities are coming out of the woodwork, saying, ‘Shoot, we got forced to agree to close our coal plants. Can you help us? We don’t want to close our coal plants.’”
Duke Energy, a major U.S. utility operating in the Southeast and elsewhere, is planning to delay retirements for three coal plants. But many experts say the administration is overreaching.
“A lot of these retiring plants tend to be very old,” said the lobbyist who spoke about a Democratic backlash in the future. “Utilities shouldn’t be forced to keep them open.”
Rogers, the White House spokesperson, said DOE “will continue using emergency powers to ensure American communities do not experience blackouts or brownouts.”
The foreseeable future is likely to be messy for White House plans on electricity. Still, some experts say the administration is a long-term boon for the utility sector.
“There will be tension and push-pull in the sausage making because utilities have made decisions to close plants or build renewables,” said Tom Pyle, president for the American Energy Alliance, a conservative group that advocates for limited government. “But the Trump administration is a bright spot for utilities of all types because he wants to expand the pie across the board.”
