President Plans to Fast-Track Projects by Using Emergency Powers
Data centers were front and center in President Donald Trump’s first week of his second term as he highlighted a joint venture between OpenAI, Oracle and SoftBank that pledges to invest $500 billion in co-locating power generation and AI data center projects.
Trump says he plans to help fast-track the AI data center buildouts by invoking emergency powers under his executive order “Declaring a National Energy Emergency.
“I can get the approvals done myself without having to go through years of waiting,” Trump told the World Economic Forum in Davos, Switzerland. “I’m going to give emergency declarations so that they can start building them almost immediately.”
The $500 billion Stargate Project follows an announcement earlier this month that an Emirati company, led by billionaire Hussain Sajwani, would invest $20 billion in U.S. data centers.
Financial company Blackstone estimated in October that AI would require $1 trillion invested in the U.S. over the next five years as an explosion in data was creating an urgent need for physical infrastructure to store, process and deliver it.
First Stargate Project Data Centers Underway in Texas
Abilene, Texas has been chosen as the first site for the $500 billion Stargate Project and work is already underway.
"The data centers are actually under construction, the first of them are under construction in Texas," Oracle Executive Chairman, Larry Ellison said. "Each building is half a million square feet. There are 10 buildings currently being built but that will expand to 20 in other locations beyond the Abilene location, which is our first location."
The Stargate Project is a new company that intends to invest $500 billion over the next four years building new AI infrastructure for OpenAI in the United States.
“We will begin deploying $100 billion immediately. This infrastructure will secure American leadership in AI, create hundreds of thousands of American jobs, and generate massive economic benefit for the entire world,” said a Stargate Project statement. “This project will not only support the re-industrialization of the United States but also provide a strategic capability to protect the national security of America and its allies.”
The Stargate Project lineup includes:
- The initial equity funders in Stargate are SoftBank, OpenAI, Oracle and MGX.
- SoftBank and OpenAI are the lead partners for Stargate, with SoftBank having financial responsibility and OpenAI having operational responsibility. Masayoshi Son will be the chairman.
- Arm, Microsoft, NVIDIA, Oracle and OpenAI are the key initial technology partners.
Utility Dive reported that Trump said that, to compete with China and other countries “we need to double the energy we currently have in the United States … for AI to really be as big as we want to have it.”
On the day after his second inauguration, Trump hosted at the White House Ellison of Oracle, Son of SoftBank and Sam Altman of OpenAI.
“This will be the most important project of this era,” said Altman, according to the Associated Press (AP) .
The AP said that “the White House has put an emphasis on making it easier to build out new electricity generation in anticipation of AI’s expansion, knowing that the United States is in a competitive race against China to develop a technology increasingly being adopted by businesses.”
Declaring a National Energy Emergency
President Trump signed on Jan. 20, 2025 an executive order “Declaring a National Energy Emergency.”
“The United States’ ability to remain at the forefront of technological innovation depends on a reliable supply of energy and the integrity of our Nation’s electrical grid,” read part of the executive order.
E&E News by Politico reported that power demand for new data centers to serve the booming artificial intelligence business is surging and that solar power and battery storage projects are not keeping up with the announced and planned retirements of coal- and gas-fired generation.
U.S. Energy Information Administration (EIA) reported that:
- Almost 80,000 megawatts of power plants are confirmed as retirements in the next decade.
- Another 115,000 MW have announced plans to also shut down in the coming years.
- Only 50,000 MW of new generation will come online by the end of 2026.
“[NERC chief executive Jim] Robb has warned that grid operators have to face the possibility that more than 200,000 MW of new power demand than was anticipated just a few years ago will be needed for new data centers,” according to E&E News.
$20 Billion Investment for Data Centers Announced
Before taking office for a second time, Trump announced in early January that he had secured a pledge of a $20 billion investment for data centers in the United States by an Emirati company.
“The investment by DAMAC Properties in the United Arab Emirates is intended to highlight Trump’s personal ability to attract new money for big projects,” reported the AP. “The announcement follows a pledge made last month by the Japanese billionaire investor Masayoshi Son, while at Trump’s side, to invest $100 billion in the United States.
AP said the billionaire behind the $20-billion investment, Sajwani, promised “investment feeds into an existing boom for constructing data centers used in the development of artificial intelligence and expansion of cryptocurrency, as well as in other elements of an increasingly digital economy that relies on having greater sources of computer processing power.”
The investment, according to AP, would be the first data center projects in the U.S. for Sajwani’s EDGNEX data center portfolio, which already has plans to build data centers in the UAE, Saudi Arabia, Turkey, Spain, Thailand and Indonesia.
Convergence of Data Centers and Power a Generational Investment Opportunity
Sean Klimczak, global head of infrastructure for Blackstone wrote in October 2024 that the convergence of data centers and power is a generational investment opportunity.
“In our view, the intersection of digital infrastructure and the need for power is one of the most exciting and critical investment themes of our time. As AI continues to evolve, the demand for data centers and power will only grow, creating a wealth of opportunities,” said Klimczak. “The rapid expansion of digital infrastructure and the growing demand for power is a topic on everyone’s mind these days. Many are wondering, does the hype really match reality? From my perspective, not only is the hype justified, but the opportunity is far larger than most realize.”
The Blackstone analysis pointed out the following data trends:
- It took ChatGPT just two months after launching to hit 100 million users.
- Data usage has increased 100 times over the past 15 years.
- More data has been created in the past three years than in all of history.
“As AI continues to gain momentum, this trend will only accelerate. Global cloud migration is still in its early stages, and with revenues from cloud services expected to more than triple in the next five years, data growth will be astronomical,” wrote Klimczak.
The growing demand for data has resulted in a correlating demand for power, especially as generative AI computing takes more power consumption that traditional tools such as Google searches.
- Over the past five years, the number of U.S.-leased data centers has increased 17 times, driven by the rise in cloud computing and AI.
- In 2024, 5,000 megawatts of data center capacity were added in the U.S. or roughly 1 percent of the nation’s total power consumption.
“The growth of data centers is a global phenomenon. We estimate that the U.S. will see over $1 trillion invested in data centers over the next five years, with an additional $1 trillion invested internationally,” said Blackstone.
Klimczak says that to keep pace, as a country we will need to double our power grid’s capacity over the next 12 to 13 years.
Shelly Palmer, a tech pundit and consultant told the IEEE Spectrum that projects like the Stargate Project could be just the answer to the twin needs of AI computer power and the juice to produce it and transmit it.
“There are many tech skeptics, and it has become fashionable to denigrate and vilify big tech. To me, the Stargate Project is the first step in securing the future of the U.S. economy as well as our digital and cyber security,” said Palmer.
And while the White House has touted 100,000+ jobs being created with the data center initiatives, Palmer thinks that’s just the tip of the iceberg: “As for the 100,000 jobs the project is supposed to create? Some construction jobs will be created as the data centers are built, but many more (millions more) will be created as the data centers come online. We’ve never had a compute cloud like this — there’s literally no way to calculate the economic impact of this amount of AI compute. It will be massive.”
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