Trump Administration Seeks $15B Power Plant Investment from Tech Companies

Washington D.C.: The Trump administration wants the biggest electricity grid to get $15 billion in new power generation. They are asking tech companies to pay for it, even if they may not use the energy. The White House and several governors want the grid operator PJM to hold an auction for 15-year contracts. Tech companies would bid on these contracts, even if they don’t ultimately need the power.

PJM is reviewing this plan and will share results soon. However, PJM doesn’t seem very interested in the government’s push. A PJM spokesperson noted they weren’t invited to the administration’s upcoming event.

PJM covers 13 states and serves over 65 million people, including many data centers in northern Virginia. Electricity rates in 2025 are likely to rise by 10% to 15% in this region.

Over the last decade, peak electricity use in PJM has grown by 10%. It might rise another 6.5% by 2027. Much of this increase is blamed on tech companies consuming more energy for AI.

The price of natural gas is also rising. PJM relies heavily on this fossil fuel, which has become more expensive. An independent monitor for PJM says that high fossil fuel prices will cause about 60% of 2025’s electricity rate increases.

PJM is in a tough spot as data centers need more power after not growing for many years. Building new power plants takes many years and costs a lot of money. Utilities are unsure if they should invest in new fossil fuel plants, especially if AI demand falls off.

Tech companies, which usually aren’t in the power business, are looking at renewable energy sources. Renewables are cheaper and quicker to set up. For example, solar farms can start producing power in about 18 months and can be built in parts. This matches the timeline of building data centers and helps manage risk.