White House makes tech giants promise to stop mooching off Americans for electricity

Big Tech signs energy promise at White House

Seven of the biggest names in tech just made a promise: they will pay for the power their AI data centers use, not you.

On March 4, Amazon, Google, Meta, Microsoft, OpenAI, Oracle, and xAI signed the Ratepayer Protection Pledge at the White House.

President Trump hosted the signing at a roundtable in the Eisenhower Executive Office Building. He said the pledge would help keep utility bills down for millions of Americans.

Trump previewed the plan during State of the Union

The pledge did not come out of nowhere. Trump first floated the idea during his State of the Union address on Feb. 24.

He told Congress that major tech companies have an obligation to cover their own power needs. He even suggested they could build their own power plants so nobody’s electricity prices go up.

The White House had been putting the initiative together since at least January, and the March 4 signing made it official.

Five commitments make up the pledge

The pledge lays out five things each company agreed to do. First, they must build, bring, or buy all new power their data centers need and pay the full cost.

They also must cover upgrades to power delivery systems so those bills do not land on households. Each company will negotiate separate rate deals with utilities and state governments wherever they build.

They committed to hiring locally and funding workforce programs. And where possible, they will make backup power available to local grids during shortages.

Companies pay even if they don’t use the power

Here is one detail that stands out: the companies agreed to pay for contracted power and infrastructure even if they never flip the switch.

That means households are shielded whether the data centers run at full speed or sit idle. Trump also signed a formal presidential proclamation that day, making the pledge part of national policy.

The proclamation names all seven companies and says the commitments apply to every new data center project going forward.

Top executives showed up for the signing

Each company sent a heavy hitter to the table. Alphabet President Ruth Porat attended for Google, and Microsoft Vice Chair Brad Smith represented his company.

Meta sent President Dina Powell McCormick, while Amazon Web Services CEO Matt Garman signed for Amazon. Oracle co-CEO Clay Magouyrk and OpenAI COO Brad Lightcap also attended.

SpaceX President Gwynne Shotwell represented xAI, which merged with SpaceX in late January.

Rising electricity costs pushed the issue forward

This pledge did not happen in a vacuum. Residential electricity prices jumped more than 6% in January compared to a year earlier.

AI data center construction has driven a surge in power demand across the country.

In the region covered by PJM Interconnection, the nation’s largest grid operator, wholesale capacity prices climbed sharply in recent years.

With midterm elections on the horizon, energy costs have become a top concern for voters.

Communities have pushed back against data centers

It is not just prices driving the conversation. Communities from rural Texas to Denver to New Orleans have fought back against new data center projects.

In December, more than 230 national, state, and local groups signed a letter asking Congress for a pause on new construction.

Texas passed a law giving local grid operators the authority to cut data center power use during emergencies. Some cities and towns have gone further with temporary bans on new builds.

The pledge carries no legal enforcement

Here is the catch: the pledge is voluntary. The White House has no authority to enforce it, and there are no public penalties if companies fall short.

Consumer advocates have called it a handshake agreement between Silicon Valley and the White House with no legal teeth.

To actually make these promises real, each company must sit down and negotiate specific deals with individual utilities and state governments wherever they plan to build.

Some companies say they already cover costs

Some signers say they have been doing this all along. Google has said it already covers its own data center energy costs.

Meta said it pays the full cost and has done so from the start. Several companies had made independent pledges before the White House event even happened.

Critics point out the pledge may not change much about how these companies already operate, which raises questions about what the signing actually accomplishes.

Supporters say pledge protects families

Not everyone is skeptical. Energy Secretary Chris Wright said the pledge would deliver more affordable, reliable, and secure energy for the American people.

Meta’s McCormick said it ensures families are not paying for AI’s power consumption. OpenAI’s Lightcap said the infrastructure behind AI should benefit the communities that make it possible.

The Edison Electric Institute, which represents U.S. electric companies, also backed the pledge.

Experts question whether promises will stick

A Harvard Law School electricity expert called the pledge a show designed to sweep the issue under the rug. The expert said the White House has no real power beyond the bully pulpit when it comes to electricity pricing.

Consumer groups say the true test will come when utility bills arrive.

Energy regulators and watchdog groups say they plan to monitor whether the promises lead to actual savings for households.

Negotiations with local utilities come next

The signing was the easy part. Now each company must negotiate specific rate structures with local utilities and state governments in every location where they build.

State public utility commissions may reopen pricing rules for large data center customers. Regulators and consumer groups plan to push for transparent accounting so households can verify they are protected.

Some lawmakers have already signaled interest in legislation that would make these types of commitments legally binding.

This article was created with AI assistance and human editing.

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