The Donald Trump administration is accelerating the construction of data centers as a matter of national security. At the same time, obstacles were placed in front of solar and wind power plants.
But the two policies may conflict: Multiple data suggest that blocking renewable energy projects threatens to slow the AI boom and could exacerbate rising electricity prices.
“This is a time when everyone needs to mobilize to ensure supplies,” said Robert Whaley, director of US energy at consultancy Wood Mackenzie. “In the next 10 years, there is nothing that can replace renewables.”
The explosion of AI and its energy requirements has occurred much faster than the pace at which utilities typically plan and build large plants. In response, big tech companies like Alphabet’s Meta and Google have resorted to aggressive measures to keep up with this growth, setting up data centers in tents and signing contracts to build their own factories.
To date, renewable energy remains the fastest and cheapest option for expanding electricity grid supply. Nearly 80% of the planned plant’s capacity is tied to renewable energy sources, according to records from federal regulators and grid operators compiled by data firm Cleanview.co.
The number of requests to establish natural gas and nuclear plants, which are the options that Trump calls for to support the advancement of artificial intelligence, is much smaller, and represents about 14% of the planned capacity.
This dynamic creates a potential political challenge for Trump: His goal to use the AI boom as a driver of the economy could lead to a backlash at the ballot box if voters blame the data centers he promoted for rising electricity bills.
AI-powered electricity consumption is likely to keep renewables growing, but every green project blocked means fewer electrons are added to the grid to ease the shortage, analysts say.
This does not mean that natural gas, Trump’s most viable and cheapest option, will not play a role in the AI matrix: unlike intermittent solar and wind, gas can provide the constant, 24-hour power needed for data centers. Meta, for example, relies on fuel to power its giant data center complex in Louisiana.
The influx of requests for renewable energy is explained by subsidies imposed by the inflation control law, which in the eyes of the Trump administration distorted the market and discouraged investment in gas plants.
“President Trump is expanding stationary power capacity from reliable sources such as natural gas, coal, and nuclear to meet the growing demand for electricity from artificial intelligence and data centers,” White House spokeswoman Taylor Rogers said. “Intermittent and unreliable sources like offshore wind, fueled by the ‘New Green Scam,’ simply cannot generate the sustained energy needed to make the United States a world leader in cutting-edge technologies like artificial intelligence and quantum computing.”
But the costs of building solar and wind farms fell sharply in the years before those incentives expired. Meanwhile, building enough nuclear and gas power plants to power data centers could be very slow and expensive. There is a shortage of gas turbines – the crucial equipment for converting gas into electricity – and even if Trump rushes to license a new generation of small modular reactors, they are not expected to be ready before the end of the decade.
Incremental transmission
In the United States, energy consumption in data centers is expected to nearly triple by 2035, according to BloombergNEF. This jump, combined with growing demand from manufacturing and electricity, equates to having to power up to 190 million new homes by 2040, according to the American Clean Energy Association.
Coal probably won’t have much of an impact. Today, power from a new coal-fired plant would cost at least $71 per megawatt-hour of capacity, versus about $38 for solar or wind, according to Lazard. Coal plants take much longer to build.
Moreover, the potential to extract more energy from existing coal plants, either by increasing their use or delaying their closure, is limited, according to BloombergNEF.
Even after recent policy changes, including a $625 million coal subsidy programme, Wood Mackenzie expects coal installed capacity to continue to decline year-on-year.
Natural gas is more competitive and faster to build than coal. This correlates to 13% of the planned capacity of new plants expected to come into operation over the next 10 years, according to data from Cleanview.co. But this ecosystem is also limited: about 70% of the world’s gas turbines come from just three companies, whose production for the next decade has already been sold, and which show little interest in expanding their capacity.
Nuclear power, which Trump promoted by accelerating regulatory approvals and committing at least $80 billion to build new reactors, is seeing a modest comeback.
Today, battery storage systems, solar and wind farms are faster and cheaper to build per kilowatt of capacity than any other alternative, according to Lazard.
Most solar, battery and wind projects do not require lengthy air quality permits, allowing them to be built in less than five years. Some will be ready in up to a year and a half, according to BloombergNEF. The timeline for gas plants ranges, on average, from three and a half to five years – and tends to increase due to bottlenecks in the supply chain. Delivery times for large gas-fired plants have increased by more than a year since 2023, according to the analysis.
More than 90% of the plants under implementation, about 5,700 facilities, are connected to renewable energy sources, according to Cleanview.co.
The company’s founder and CEO, Michael Thomas, points out that many of these plans were put in place during the Biden administration and will not expire. As federal support for renewable energy sources expires in 2028, some will lose their viability. Others are just reservations by agents who will specify the fuel type later.
For example, the government canceled the environmental impact analysis of North America’s largest solar park — a group of projects called Esmeralda Seven — in October. Developers would need to obtain individual approvals from an administration that does not support large solar projects on federal lands.
Other projects may also be blocked, according to the Solar Energy Industries Association. The entity estimates that new solar and storage projects – which represent more than half of new plant proposals – have not yet received licenses and are at risk.
However, requests reflect intentions and demonstrate the feasibility of each option. Thomas said that despite the White House rhetoric, many renewable energy projects are likely to move forward because AI developers are moving so quickly. In fact, delays to new solar projects are decreasing, according to federal data.
“There is a lot of theater in all of this, in what the Trump administration says and what it actually does,” he said. “Things keep getting permitting and building. People are just trying to fly under the radar.”
The head of one of the largest renewable energy developers in the United States told investors on November 5 that the data center industry still wants clean energy for its operations.
“Look, this is what you can build in this period,” said Andris Gloski, CEO of AES Corp. “There may be talk of nuclear or other technologies; that takes years. So what will meet most of the demand? Well, this year it will probably be 90% renewables and batteries, and very likely next year as well.”
Big technology companies have signed contracts with gas plants for continuous power, but say they remain committed to clean energy goals. As deals are struck to bring gas directly to data centres, companies are also buying clean energy contracts that will lead to more renewables on the grid, according to BloombergNEF analyst Niall Prihe.
In the first half of 2025, Meta, Microsoft, Amazon and Google are contracted to produce 9.6 gigawatts of renewable energy, equivalent to 7.2 million homes, for delivery in the United States over the next few years.
Ultimately, the mismatch between the speed of construction of data centers and the pace of expansion of electricity generation tends to favor renewable energy sources. When Trump’s “big beautiful bill” eliminated green subsidies, Wood Mackenzie cut its forecast for renewable plants, but only by 8%. By 2034, the consulting firm expects US utilities to add another 666 gigawatts in solar, wind and storage, compared with just 126 gigawatts from gas.
Wood Mackenzie’s Willey doesn’t expect Trump to stop attacking renewables publicly. But away from the microphones, and in the complex tangle of energy policy, he believes conservative policymakers can quietly tolerate a greener matrix. In fact, as of September of this year, renewable sources accounted for 89% of new installed electrical capacity, according to the Energy Information Administration.
“MAGA has to be MAGA; they have to keep the base motivated,” Whaley said. “But internally, I think there will be compromises, because they don’t want to lose the AI race to China.”