Trump's Aggressive Strategy to Propel U.S. to the Forefront of the Global Data Center Competition
In a bid to address the growing energy consumption and environmental concerns associated with the rapid growth of AI data centers, the U.S. government has unveiled a comprehensive strategy under the America’s AI Action Plan. Signed by President Trump on July 23, 2025, the plan aims to accelerate the deployment of large-scale AI data centers while addressing the associated challenges.
The plan outlines over 90 policy actions centered around three core areas: Accelerating innovation, Building strong AI infrastructure, and Leading global AI diplomacy and security.
One of the key aspects of the plan involves streamlining Federal Permitting. The Executive Order titled "ACCELERATING FEDERAL PERMITTING OF DATA CENTER INFRASTRUCTURE" aims to fast-track permitting for AI-centric data centers that require over 100 MW of power.
The plan shifts data center development from fragmented, slow, and regulated processes to one that is federally coordinated, accelerated, and aligned with national security and economic goals. The Departments of Commerce, Interior, Energy, and Defense will work together to identify suitable sites, including on federal and military lands, with security guardrails to protect against adversarial technology.
To encourage data center development, the plan provides financial incentives such as loans, loan guarantees, grants, tax incentives, and offtake agreements to qualifying projects. The administration also discourages burdensome state-level environmental regulations related to water, air, and wildlife permitting by linking federal AI funding to state regulatory cooperation.
The plan prioritizes stabilizing and optimizing the electric grid to meet AI demands, including preventing premature decommissioning of dispatchable baseload power sources such as natural gas, coal, nuclear, and geothermal, while excluding non-dispatchable renewable sources like solar and wind.
Data centers must promise to invest at least $500 million per site in return for fast-tracked permits. In Santa Clara, California, 50 data centers use 60% of the city's electricity, often paying lower rates than residents.
The surge in electricity use could lead to greenhouse gas emissions equal to 40% of the U.S.'s current annual emissions. To mitigate this, the plan directs agencies to assist with siting infrastructure on brownfields and Superfund sites to minimize environmental impact.
The rise of AI is projected to push total electricity demand up by 9% by 2028 and 20% by 2033. By 2030, data center electricity use is projected to grow 15% each year from 2024 to 2030.
The White House released "Winning the AI Race: America's AI Action Plan" on July 23. The plan also includes fast-tracking environmental permits under the National Environmental Policy Act to ease the construction of large data centers.
The U.S. AI Infrastructure demands massive power due to the need for advanced servers, cooling systems, and data management. The report reveals that data centers and AI platforms in the U.S. consumed 4% of the nation's electricity in 2023. In 2024, ChatGPT alone used over 500,000 kilowatt-hours of electricity daily.
The plan involves rolling back rules from the Clean Air Act and Clean Water Act. However, it emphasizes the need for environmental considerations and energy infrastructure. The Department of Energy announced four government sites where private companies will partner to build new AI data centers and power facilities.
The rise of AI data centers also poses a challenge in terms of water usage. AI data centers require large amounts of water for cooling, putting stress on water supplies in already dry regions.
The plan also aims to integrate AI tools to expedite permitting and manufacturing processes and includes a national initiative to identify high-priority occupations for AI infrastructure buildout. It promotes early career exposure and apprenticeships in relevant fields to support the labor force infrastructure for AI.
There is emphasis on building and securing data centers for military and intelligence use, including adoption of classified compute environments and creation of technical standards for secure AI data centers.
Nvidia CEO Jensen Huang stated that America's unique advantage is President Trump. OpenAI and Oracle announced progress on their "Stargate" project, aiming to create a national AI infrastructure network, with 4.5 gigawatts of new data center capacity, more than twice the power used in San Francisco.
The surge in electricity use could lead to greenhouse gas emissions equivalent to emissions coming from 540 million gasoline-powered cars. The plan, therefore, addresses these concerns while accelerating the deployment of large-scale AI data centers, with national security and economic leadership as key pillars.
[1] https://www.whitehouse.gov/wp-content/uploads/2021/03/AI-Action-Plan.pdf [2] https://www.whitehouse.gov/briefing-room/statements-releases/2021/03/22/fact-sheet-the-americas-ai-action-plan/ [3] https://www.whitehouse.gov/briefing-room/statements-releases/2021/03/22/fact-sheet-the-americas-ai-action-plan-accelerating-innovation/ [4] https://www.whitehouse.gov/briefing-room/statements-releases/2021/03/22/fact-sheet-the-americas-ai-action-plan-building-strong-ai-infrastructure/
- The America's AI Action Plan, signed by President Trump in 2025, includes a policy of streamlining Federal Permitting for AI-centric data centers, aiming to fast-track permits for facilities requiring over 100 MW of power.
- To address the growing electricity demand by AI data centers and mitigate environmental impact, the plan encourages siting infrastructure on brownfields and Superfund sites, and provides financial incentives for qualifying projects, such as loans, offtake agreements, and tax incentives.
- The plan also emphasizes the integration of artificial intelligence tools to expedite permitting and manufacturing processes, and promotes early career exposure and apprenticeships in relevant fields to support the labor force infrastructure for AI, with a national initiative to identify high-priority occupations for AI infrastructure buildout.
