Trump says deal on data centers will lower electricity costs, but offers few details

WASHINGTON (AP) — President Donald Trump invited technology companies to the White House on Wednesday to commit to developing their own power generation as he tries to ease tensions over the cost of electricity used by data centers to develop artificial intelligence.

“They need some PR help because people think that if a data center goes in there, electricity prices are going to go up,” Trump said. “It’s not going to happen.”

The “ratepayer protection” pledge touted by the president comes as affordability has become a top concern for an American public wary of the possibility that the AI buildout could lead to higher utility bills. Trump first announced the pledge during his State of the Union address last month, but provided few details

Communities across the nation have seen a backlash against data centers over fears about rising electricity prices and concerns about pollution and water consumption. Opposition to rising power prices was also a key factor in Democratic wins last year in elections in states including Georgia, Virginia and New Jersey.

The president has sought to deflect public concerns about AI, seeing the fast-evolving technology as crucial for the U.S. to attract foreign investment and maintain its economic and military prowess. But it’s unclear whether the commitments will meaningfully shield Americans from higher electricity prices that have climbed 6.3% over the past year, according to the Labor Department’s consumer price index.

The president stressed that he understands that demand for energy will triple by 2035 largely because of AI, meaning that the U.S. needs to dramatically increase its construction of power plants. Construction spending on power generation jumped in 2022, but it has drifted slightly downward after peaking in October 2023, according to the Census Bureau. Trump has also sought to cancel wind power projects while elevating coal — which contributes to climate change — as a source of energy.

The companies committing to the pledge included Google, Microsoft, Meta, Oracle, xAI, OpenAI and Amazon.

Under the terms of the pledge, the companies intend to build or buy new sources of power generation for their data centers and cover the expense of infrastructure upgrades. The companies could also sell excess power generation to utilities for public consumption, in addition to negotiating separate rate structures with public utilities and hiring locally for their data center buildout.

Energy experts have expressed doubt that promises by the tech companies can slow down fast-rising electricity prices. While Trump said the pledge would force tech companies to produce their own electricity, the deal is likely not enforceable at the federal level, experts said. Electricity supplies are mostly regulated at the state level and managed across regions, using market structures that vary across the country.

Jill Tauber, vice president of litigation for climate and energy at Earthjustice, said that actual policies needed to be in place rather than a signed pledge of unclear legal value.

“Data centers are increasing costs and pollution for communities across the country,” Tauber said in a statement. “More than a pledge, we urgently need strong policies and protections to ensure that data centers pay their way, disclose and mitigate their impacts, and are powered by clean energy.”