Trump’s power play risks slowing US in AI arms race

Investing.com -- President Donald Trump’s latest push to shield Americans from higher power bills risks colliding with Washington’s drive to stay ahead in the AI arms race, with Wedbush warning that forcing Big Tech to “pay their own way” on soaring electricity costs could slow the buildout of data centers that underpin the AI boom.

Late Monday, Trump said his administration was working with major tech companies on “major changes” to ensure consumers do not “pick up the tab” for data centers’ growing power use and insisted companies that build them must “pay their own way,” singling out Microsoft as the first partner in the effort.

Following Trump’s post, Microsoft Corporation (NASDAQ: MSFT) rolled out its Community‑First AI Infrastructure initiative, a five‑step plan aimed at making sure AI infrastructure costs are not pushed onto local communities around data center sites. The company pledged to pay utility rates high enough to cover electricity costs, work with utilities to add capacity and boost efficiency, and cut data center water use by 40% by 2030 to prevent local water resources from being depleted, a template Wedbush expects “other Big Tech organizations to follow” amid mounting scrutiny from federal, state and local officials.

The political pressure reflects a real squeeze on households. With residential utility bills up 6% year on year nationwide in August 2025, according to CNBC. states with dense data center clusters saw much steeper increases, including a 16% jump in Illinois, 13% in Virginia and 12% in Ohio. Virginia governor‑elect Abigail Spanberger, meanwhile, has also echoed that data centers should “pay their own way and their fair share” of rising electricity costs as lawmakers juggle tax revenue from new facilities with community concerns.

Wedbush sees Trump’s move as both a relief valve for the White House and a fresh constraint for tech. “While this initiative alleviates a major headache from the Trump administration, this will create a larger bottleneck with big tech organizations looking to build out large data center footprints as quickly as possible without impacting the bottom-line,” the analysts said, warning this could slow buildouts “with the US entering a crucial time of the AI Revolution with the US facing significant energy shortages/issues to fuel data center buildouts.”​

At the same time, however, the analysts suggest that the AI race is increasingly a clean‑energy race. Meta has locked in 6.6 gigawatts of nuclear power deals with Vistra Energy Corp (NYSE: VST), TerraPower and Oklo by 2035 on top of an earlier Constellation Energy agreement. Google (NASDAQ: GOOGL), meanwhile, has bought Intersect Power in a $4.75 billion cash deal and signed for up to 3 gigawatts of carbon‑free hydroelectric capacity with Brookfield Renewable, while Microsoft agreed a $6.2 billion contract with Nscale Global and Aker for renewable‑powered AI infrastructure in Norway.

That scramble is also driven by competitive pressure from abroad. With China “spending incrementally more across new and existing power technologies into 2030,” Wedbush expects “a continuous back and forth battle between Big Tech players and the Trump administration” over who foots the power bill, even as both sides know data center buildouts are “an important aspect of fueling the AI Revolution over the coming years.”

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