House subcommittee: U.S. lacks energy infrastructure to power AI 'moonshot' as data centers surge

The Subcommittee on Economic Growth, Energy Policy, and Regulatory Affairs opened a hearing March 28 to examine what members and witnesses called the energy and infrastructure gaps threatening "America's AI moonshot." Chairman Burleson convened the meeting and framed the issue by saying the hearing would discuss "America's AI moonshot."

Neil Chilson, head of AI policy at the Abundance Institute, told the panel that AI could generate large economic and health benefits but that realizing them requires both software-friendly federal policy and faster energy infrastructure development. "America's AI moonshot depends on getting both regulatory environments right," Chilson said in his opening remarks.

The hearing brought three industry and policy witnesses who largely agreed that data center growth is accelerating demand for electricity and other local resources. Josh Levy, president of the Data Center Coalition, said U.S. data center capacity is expanding rapidly and that his members face three main barriers: timely access to reliable energy, equipment supply-chain constraints and workforce shortages. "To meet growing demand for these digital services, our member companies are making multibillion dollar investments in data center infrastructure," Levy said.

Energy-policy witness Mark Mills, executive director of the National Center for Energy Analytics, emphasized the arithmetic of power demand and the speed needed to add generation. He said credible forecasts show data centers could require "somewhere between 70 gigawatts and 130 gigawatts more power capacity" than planners expected a few years ago and argued much of the new power will come from natural gas combustion turbines in the near term.

By contrast, Tyson Slocum, energy program director at Public Citizen, urged restraint in rushing to build new fossil-fuel capacity and warned of stranded-asset risk if long-lived infrastructure is driven by hype rather than measured demand. "Allowing hype and hysteria to drive long term capital intensive infrastructure investments will lead to stranded assets that may threaten taxpayers, and ratepayers with unnecessary costs," Slocum testified, and he recommended stronger demand-management and regulatory oversight.

Lawmakers from both parties pressed witnesses on local impacts. Representative Subramuniam of Virginia described Northern Virginia as a global crossroads for Internet traffic and warned that concentrated data center growth has strained transmission lines, raised local utility bills and put pressure on water supplies. "If my district were a country, it had more data centers than most every other country in the world," Subramuniam said, noting that localized outages had nearly caused blackouts in the past year.

Members and witnesses cited multiple quantitative claims during the hearing that shaped the discussion: a Department of Energy figure cited by a panelist that data centers used roughly 4.4% of U.S. electricity in 2023 and could rise to about 6.7% by 2028; a December report the committee referenced saying Virginia's data center industry contributes an estimated 74,000 jobs and roughly $9.1 billion in GDP annually; and academic and industry estimates that single large data center campuses can consume on the order of a gigawatt of power and millions of gallons of water daily for cooling.

Witnesses offered a range of policy responses: Chilson urged federal action to prevent conflicting state AI regulations and to create regulatory sandboxes for software; Levy called for speeding permitting for electric transmission and generation and expanding domestic manufacturing of electrical equipment; Mills recommended asking private firms to identify regulatory impediments and accelerating deployment of dispatchable generation; Slocum advocated more aggressive demand response, efficiency requirements, and oversight of deals that shift costs to local ratepayers.

Some members pressed nuclear options: several members asked about small modular reactors (SMRs) and the reopening of existing nuclear assets as a way to secure reliable, low-carbon baseload power for data centers. Mills noted SMRs are not yet commercially deployed at scale and predicted several years before they materially affect capacity, while also saying nuclear can provide reliable, dispatchable power where available.

The hearing also covered supply-chain constraints for transformers and electrical gear and workforce needs for construction and operations. Levy urged congressional and administrative steps to expand domestic capacity for critical equipment and training programs to shore up labor shortages.

The panel did not vote on legislation. Members requested additional written testimony and pledged continued oversight. In closing, Ranking Member Frost summarized the bipartisan tension: embrace AI's opportunity while ensuring communities and consumers are not left bearing disproportionate costs. "We can support innovation without removing the safeguards that have prioritized personal civil rights and liberties," Frost said in an opening statement, and repeated the need for balanced policymaking in closing remarks.

The subcommittee's testimony laid out competing priorities for Congress: accelerate permitting and grid interconnection to sustain rapid private investment in AI infrastructure, while protecting ratepayers, water resources and local communities through efficiency, demand response and oversight.

Ending: The subcommittee allowed members five legislative days to submit additional questions and materials for the record and adjourned with lawmakers and witnesses agreeing the issue merits further study and possible legislation.