The AI build-out has done something the fossil-fuel industry could not do for itself. It has set off the largest-ever construction boom in natural gas-fired power plants, the Associated Press reports.
Aging coal plants are being kept alive past their retirement dates too. Utilities, plant owners, and the federal government have all pushed to postpone the shutdowns.
The reason is unglamorous arithmetic. Some data centres consume more electricity than a mid-size city, and wind and solar cannot be built at that speed.
The states drawing lines
Several states are trying to force the issue through law. A bill on New York Governor Kathy Hochul’s desk would make large data centres hit renewable benchmarks from 2030, reaching at least 90% renewable energy by 2040.
Its author, state Senator Kristen Gonzalez, thinks the targets are achievable. These are the wealthiest companies on earth, she argued, and firms able to spend billions on data centres can afford to build the power to run them.
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Michigan, Oregon, and Minnesota moved first. All three passed laws in the last 18 months to defend existing commitments to emissions-free electricity by 2040.
Michigan tied it to money, requiring hyperscale data centres to reach 90% clean energy within six years to keep a lucrative sales tax exemption. Similar bills have appeared in California, Illinois, New Jersey, Pennsylvania, and Virginia.
An honest admission from the other side
The most useful quote in the story is not a triumphant one. Bob Jenks of the Oregon Citizens’ Utility Board conceded the 2040 target was hard to meet with data centres, and hard to meet without them.
That is the shape of the problem. The clean-energy goal was already stretching, and AI has arrived and pulled it further out of reach.
Households are feeling it first. Electricity bills are climbing across many utility territories, and AI data centres are driving up power costs at Rust Belt factories.
The regulatory back door
Unable to outbuild the boom, advocates have gone after the rules instead. The tactic is to get regulators to let large power users build their own clean generation and plug it into the grid.
Colorado ordered Xcel Energy to create such a programme. In an April filing Xcel accepted it could benefit customers, citing Google projects connecting 115 megawatts of geothermal in Nevada and 1,900 megawatts of wind, solar, and storage in Minnesota.
Google’s deal with NV Energy is seen as the first of its kind, and the company says similar arrangements are approved or pending in eight more states. The Corporate Energy Buyers Association struck a comparable deal with Georgia Power and is now working on North Carolina.
The pitch to utilities is commercial, not moral. They gain a huge long-term customer who pays to expand the grid, rather than watching that customer build standalone generation and leave.
Why this is the real fight
Grid access is where the outcome gets decided, not the legislature. Regulators have been fast-tracking data-centre grid connections, and whoever controls that queue controls what gets built.
Money is chasing the same bottleneck, with Nvidia-backed startups raising to solve data-centre power. Energy, not silicon, is now the binding constraint on AI.
Communities are pushing back independently, having blocked 75 data-centre projects worth $130bn in a single quarter. Congress is circling too, with the House voting on a bill to push data-centre energy costs back onto the companies creating them.
CEBA’s policy chief reckons the decisions being taken now will set energy policy for two or three decades. That is probably right, and it is why a technical argument about grid interconnection is worth more attention than it gets.
The gas plants are being poured in concrete while the rules are still being written. Concrete tends to win those races.
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