Energy Department will spend $2 billion to squeeze more electricity from aging power grid
The US Energy Department will invest $2 billion into 31 projects across 26 states to upgrade the aging national power grid. This initiative aims to boost electricity capacity and reliability, addressing skyrocketing energy demand from artificial intelligence and new data centers. The announcement comes amidst increasing national concerns over data center power consumption and community opposition.
The U.S. Energy Department announced a nearly $2 billion investment to upgrade the nation's aging and strained power grid, aiming to extract more electricity to meet skyrocketing energy demand, particularly from artificial intelligence data centers. The funding will support 31 projects across 26 states, expected to add over 23 gigawatts of electricity capacity, enough to power 16 million homes. Energy Secretary Chris Wright was scheduled to announce the grant program in Allentown, Pennsylvania, with the Associated Press reporting details prior to the public release.
This initiative comes amidst warnings that the rapid expansion of data centers, fueled by AI, is outpacing the construction of new power plants, threatening to overwhelm existing U.S. power supplies. Rising electricity bills in many regions are also being attributed to data center demand. The article notes growing national opposition to data centers, with communities across the country attempting to block new developments, despite former President Donald Trump's continued support for them.
Critics argue that utilities, which have seen increased profits during the data center-fueled energy boom, prefer building expensive new infrastructure over implementing more efficient technologies. Additionally, Trump's Environmental Protection Agency recently issued a plan to reduce public transparency and comment opportunities for proposed AI data centers. The new grant money, derived from a bipartisan infrastructure law, will be matched by $3.35 billion in cost-share funding from recipients.