U.S. Commits Nearly $2 Billion to Squeeze More Power From Aging Grid

The Energy Department said Thursday it will spend almost $2 billion to squeeze more electricity out of the nation's aging and stressed power grid, as President Donald Trump's administration steps up efforts to avoid blackouts amid skyrocketing energy demand driven by artificial intelligence.

The money will fund 31 projects across 26 states that are expected to produce more than 23 gigawatts of additional electricity capacity — enough to power 16 million homes. The projects will deploy new technologies such as sensors that measure real-time weather conditions to ensure safe transmission or direct power away from congested paths, the department said.

Officials said the upgrades could improve reliability and lower electricity costs for about 100 million Americans.

"This is a quick way to lower electricity prices and increase reliability: using fibers that are already in the transmission lines to analyze what's the temperature out, what's the wind out, how can we use this transmission line to distribute more power, but safely and only in the right conditions," Energy Secretary Chris Wright said at a news conference Thursday promoting the grants at a PPL Corp. facility in Allentown, Pennsylvania.

PPL, the eastern Pennsylvania electric utility, said two data centers in its territory came online this year and six more are under construction. Enough additional data centers are in advanced planning stages that the utility's peak electric demand could quintuple by 2032. PPL is receiving $71.5 million to modernize an existing high-voltage transmission line across roughly 30 miles in northern Pennsylvania.

The announcement lands amid warnings that AI's voracious demand for power threatens to overwhelm U.S. power supplies, as massive new data centers come online faster than new power plants can be built. Electricity bills are rising faster than inflation in many parts of the country, blamed in some areas on data center demand.

Local opposition to data centers has snowballed, throwing a wrench into the plans of the world's richest companies and reshaping the midterm election landscape. Trump continues to defend data centers even as politicians from both major parties criticize them and many communities try to block them.

Congress and some states, meanwhile, are pushing utilities to adopt new technologies that make grids more efficient and reduce the need to build new power plants.

Julia Selker, executive director of the WATT Coalition, a trade association for grid-enhancing technologies, called both the projects and the scale of the investment significant. She noted that U.S. utilities lag places like Europe in adopting these technologies, despite past federal investment to develop and test them.

Drew Maloney, CEO of the Edison Electric Institute, a trade association of for-profit utilities, countered that American utilities are making a "significant investment" every year in new technologies to strengthen the grid and reduce outages.

Wright said work on the projects should begin right away, and he hopes some efficiencies will be in place before this winter to tamp down price spikes when extreme weather sends demand skyrocketing.

He said he did not know whether the projects would have gone ahead without federal funding. Many had been under consideration before the grants were offered, he said, but the recipients hadn't "quite pulled the trigger" on them.

The projects involve component enhancements on more than 1,500 miles of transmission lines and technological enhancements across nearly 21,000 miles, the department said. Officials prioritized projects that can be put into operation quickly.

The grant funding comes from the bipartisan infrastructure law enacted by Congress under then-President Joe Biden. The government's $1.9 billion will be matched by $3.35 billion from the recipients, the department said.

Recipients include utilities, cooperatives and four state agencies. The state agencies — in Colorado, Indiana, Ohio and Oklahoma — are the biggest recipients, collectively drawing $810 million, with the Colorado and Oklahoma projects promising improvements to regional grids.

The grid program fits within a broader energy agenda. Trump has vowed to "unleash" the nation's energy sector in his second term, aiming to drive up record-setting domestic oil and gas production, strip away pollution restrictions on power plants and keep expensive coal-fired plants operating past their retirement dates.

His administration has also pledged nearly $4 billion to buy back offshore wind leases as Trump seeks to discourage wind energy in favor of fossil fuels. At the same time, it has pushed to help tech giants build and connect data centers to power plants and high-voltage lines, and to convert Cold War-era uranium enrichment plants into data center and power plant complexes.

With $3.35 billion in private matching funds riding on the federal outlay, the bet is that smarter wires, not just new plants, can deliver the quickest relief to a grid straining under AI's load.