{"id":282845,"date":"2026-03-18T10:00:25","date_gmt":"2026-03-18T14:00:25","guid":{"rendered":"https:\/\/ncrc.org\/?p=282845"},"modified":"2026-03-09T11:21:32","modified_gmt":"2026-03-09T15:21:32","slug":"mobility-monitor-trump-and-big-tech-attempt-to-win-over-communities-on-data-centers-will-their-partnership-bring-electricity-rates-down","status":"publish","type":"post","link":"https:\/\/ncrc.org\/mobility-monitor-trump-and-big-tech-attempt-to-win-over-communities-on-data-centers-will-their-partnership-bring-electricity-rates-down\/","title":{"rendered":"Mobility Monitor: Trump and Big Tech Attempt to Win Over Communities on Data Centers \u2013 Will Their Partnership Bring Electricity Rates Down?"},"content":{"rendered":"

Few issues have done more to shape the economy and American politics over the past year than the explosion of data center proposals to advance artificial intelligence (AI). In February, the Trump administration reportedly agreed to the terms of a \u201c<\/span>ratepayer protection pledge\u201d<\/span><\/a> with Amazon, Google, Meta, Microsoft, xAI, Oracle and OpenAI – the Big Tech firms mainly driving the surge in data center development. The agreement would have companies consent to paying for any electricity rate increases as well as supplying their own power for new data centers.\u00a0<\/span><\/p>\n

Trump\u2019s deal attempts to address widening concerns about the effect of data centers on utility costs, which has become a rallying flag for organizers and activists leading the resistance to data center construction. Data centers\u2019 connection to increased energy bills have also sparked <\/span>bipartisan efforts<\/span><\/a> in Congress from Sen. Richard Blumenthal (D-Conn.) and Sen. Josh Hawley (R-Mo.) to prevent data centers from pushing utility cost increases onto residents.<\/span><\/p>\n

Even as data centers\u2019 role in raising utility rates has captured the attention of policymakers in Washington, the nature of their relationship is complicated and reveals broader issues with the nation\u2019s energy supply and its aging electricity grid. As life remains unaffordable for many Americans, it is unclear whether Trump\u2019s partnership with Big Tech will actually help to bring down electricity bills.\u00a0<\/span><\/p>\n

Data centers have exacerbated and complicated underlying issues with energy markets and the electricity grid. Well before data centers entered the public consciousness, all <\/span>three of the main segments<\/span><\/a> of the electricity grid (generation, transmission and distribution) had been struggling with aging infrastructure for years. Largely built in the 1960s and 1970s, the electricity grid in many areas of the country desperately <\/span>needs modernization and reliability upgrades<\/span><\/a>.\u00a0<\/span><\/p>\n

Many communities are already vulnerable to reliability issues, such as power outages, and as outdated power generation sites like coal plants have been retired, some have experienced <\/span>declining power supply<\/span><\/a> ,which can increase prices. As data centers have gotten bigger and require more resources to train AI models, support AI applications and cool servers, they have also entered new areas of the country, often<\/span> introducing unprecedented levels of energy demand<\/span><\/a> on already outdated local grids. Between 2017 and 2023, data center power demand <\/span>more than doubled<\/span><\/a> largely due to the growth in AI servers.\u00a0<\/span><\/p>\n

Data centers\u2019 unprecedented energy demands have <\/span>coincided with historically high electricity prices<\/span><\/a> in several regions of the country. To meet this increased energy demand, Trump\u2019s proposed deal would require Big Tech companies to cover the costs of powering new data centers by building new generation capacity themselves or fronting the cost of doing so. If the Big Tech companies are able to stick to the agreement, then their commitments to bring more power sources online could help to prevent further increases in rates resulting from energy demand outpacing supply.<\/span><\/p>\n

But, doing so will be easier said than done. Some of the key components of power plants are increasingly scarce, namely <\/span>gas turbines<\/span><\/a>, <\/span>copper and other commodities<\/span><\/a> tied to the data center boom. Without these materials, developers may not be able to complete data center and power plant builds on time or be forced to abandon projects altogether, leaving communities to foot the bill for the costs of preparing the grid.\u00a0<\/span><\/p>\n

Even if Big Tech is able to overcome these challenges and hold up their end of the bargain, increasing electricity rates are not always related to constraints on power supply. Data center buildouts typically <\/span>require improvements<\/span><\/a> to transmission and distribution infrastructure as well, which can lead to increased prices across the market. Historically, the costs of making these kinds of upgrades to the grid have been shared and distributed across all ratepayers.\u00a0<\/span><\/p>\n

However, data centers have led many communities and local leaders to revisit this policy as they reckon with what it means to give up their land for resource-intensive data centers in order to train a technology aimed at replacing them. Trump\u2019s ratepayer protection pledge also fails to account for one of the most significant contributors to increased electricity rates: separate, opaque rate agreements between utility companies and data center developers.\u00a0<\/span><\/p>\n

With <\/span>hundreds of billions of dollars<\/span><\/a> of data center investments on the table, communities have been competing to differentiate themselves from one another for investors and developers. This often looks like offers of numerous tax abatements or exemptions on the part of local government officials. But, it can also mean utility commissioners entering into <\/span>favorable deals<\/span><\/a> with data center developers to attract projects to their area. Without safeguards to ensure accountability and transparency between data center developers and utility commissions, residents may still see increased electricity rates.\u00a0<\/span><\/p>\n

After months of backlash and resistance from communities, Big Tech companies have <\/span>yielded on<\/span><\/a> a number of concerns about the swift rollout of data centers. The Trump agreement mostly restates what several companies have already publicized. Although it might help to prevent rate increases in some areas with a more limited power supply, the agreement does not address the impact of transmission and distribution upgrades, limited supply of critical materials for constructing power plants or lack of transparency from utility commissions and developers with local communities.\u00a0<\/span><\/p>\n

Furthermore, without a clear enforcement mechanism, it is no more than a handshake agreement with no accountability for companies that do not hold up their end of the deal. As the cost of living continues to constrain economic mobility and security for communities, Trump’s ratepayer protection pledge is a start but not a long-term solution. Federal and state actions in response to concerns about data centers must empower communities\u2019 autonomy to set the terms of their own agreements with data center developers while also harnessing government power and capacity to enforce oversight, transparency and accountability where localities may lack the resources to do so.<\/span><\/p>\n

More than <\/span>190 data center bills<\/span><\/a> were introduced in state legislatures in 2025, with models like <\/span>California’s Senate Bill 57<\/span><\/a> and <\/span>Pennsylvania’s Load Forecast Accountability Act<\/span><\/a> offering frameworks for utility commission oversight and cost-shift accountability. Future federal actions must build on these efforts without constraining communities\u2019 autonomy. Congress should pass the <\/span>GRID Act<\/span><\/a>, authorize the Energy Information Administration to collect and publish data center electricity use data and require that utility contracts with data center developers be disclosed to the public rather than redacted from regulatory filings or <\/span>hidden by non-disclosure agreements<\/span><\/a>.<\/span><\/p>\n

Communities cannot be expected to protect themselves from trillion-dollar companies when the terms of the deals shaping their electricity bills are kept secret. Without binding disclosure requirements and enforceable cost protections, communities will continue to bear the costs of an AI boom while the benefits flow to the top.<\/span><\/p>\n

 <\/p>\n

Simon Wang is the Economic Mobility Specialist with NCRC’s Economic Mobility team.<\/em><\/p>\n

Photo credit: Claudio Schwarz via Unsplash.<\/a><\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

Few issues have done more to shape the economy and American politics over the past year than the explosion of data center proposals to advance artificial intelligence (AI). In February, the Trump administration reportedly agreed to the terms of a \u201cratepayer protection pledge\u201d with Amazon, Google, Meta, Microsoft, xAI, Oracle and OpenAI – the Big 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