Trump says data centers may become bigger than oil, and the stakes are rising

President Donald Trump is arguing for the rapid growth of data centers, saying the facilities could become an economic force as important as the oil industry. His comments come as artificial intelligence drives demand for massive computing sites and the power systems needed to run them.

But the push is running into resistance. Texas has ordered a review of data center projects seeking to connect to the state’s main power grid, while voters across the country are raising concerns about electricity bills, water use, and neighborhood impacts. The debate is now shaping state policy and the 2026 midterm campaigns.

Trump makes the economic case

In an Aug. 6 interview with Punchbowl News, Trump said Texas would be making a mistake by turning away data centers. He said the projects bring major investment to communities. He argued that data centers “could be bigger than oil,” a striking comparison in a state whose economy has long been tied to energy production.

Trump’s point was broader than Texas. He linked data center construction to the race for leadership in AI, saying other countries are also competing to attract the facilities. Modern AI systems depend on large amounts of computing power, making data centers a core part of the infrastructure supporting new AI tools.

The administration has already moved to speed development. A July 2025 executive order directed federal agencies to streamline permitting for qualifying data center projects and related energy infrastructure. The order said rapid infrastructure buildout was a federal priority and covered certain large AI data centers along with the energy systems they require.

Texas puts growth under a microscope

Texas Gov. Greg Abbott took a more cautious approach on Aug. 3. He directed the Public Utility Commission of Texas and the Electric Reliability Council of Texas, or ERCOT, to audit data centers as they move through the grid interconnection process before those projects can move forward.

The order was not a permanent statewide construction ban. It focused on projects seeking access to the ERCOT grid and required regulators to verify that they meet state rules and new standards. Abbott said projects that fail to comply should be denied a grid connection.

The scale of the queue helps explain the concern. Abbott’s office said ERCOT was considering more than 474 gigawatts of requests to connect to the grid, more than five times the system’s record peak demand. Since then, Texas has announced that numerous major data center companies have agreed to follow standards covering grid costs, water conservation, and community impacts.

Electricity demand is the pressure point

Data centers require a steady supply of electricity for servers, cooling equipment, and other systems. The U.S. Energy Information Administration said in March that data centers are helping to drive a new period of electricity demand growth after years of relatively little change.

EIA’s latest August outlook said U.S. electricity generation has been rising to meet growing demand from data centers. It also cut its forecast for Texas load growth in 2027 to 6%, down from 14% in the previous outlook, after Abbott ordered the review of new data center projects.

Longer-term estimates point in the same direction. A 2026 Lawrence Berkeley National Laboratory update estimated that data centers could use 11.8% of total U.S. electricity by 2030 in its reference case, with a range of 9.5% to 15.3%. Those projections help explain why cost and reliability questions are now central to the debate.

Public opposition is hard to ignore

Trump’s support for data centers is colliding with widespread local skepticism. A Gallup survey published in May found that 71% of Americans opposed building an AI data center in their area, with 48% strongly opposed.

A separate University of Pennsylvania survey released in August found 61% opposed new data centers in their area, up from 49% in a survey completed in March. The studies used different wording and methods, but both show that local resistance is substantial and crosses party lines.

Electricity costs are one of the biggest worries. A Reuters/Ipsos poll released in June found that 77% of respondents were concerned AI development could raise electricity costs. Those concerns are turning data centers into an election issue, especially in places where residents are being asked to accept large new facilities and grid upgrades.

The White House tries to protect ratepayers

The Trump administration says data center growth should not shift project-specific electricity and grid costs to households. In March, 7 technology companies voluntarily accepted the White House Ratepayer Protection Pledge.

The White House expanded the voluntary pledge in July and said it covered 80% of all power delivered to U.S. homes and businesses, protecting 263 million Americans when a data center is built nearby. Signatories commit to building, bringing, or buying power and funding delivery upgrades.

Electricity rates remain largely governed by utilities, state regulators, and regional market rules. Berkeley Lab has warned that large loads can create risks when infrastructure is underused or when customers do not pay their full costs.

Washington is debating other answers

Trump is not the only national politician trying to shape the data center boom. Lawmakers are offering very different approaches, showing how quickly the issue has moved from local planning meetings into national economic and energy policy.

Sen. Ron Wyden of Oregon released a draft proposal in August that would change the tax treatment of data centers and create a new excise tax to raise revenue for workers affected by AI-driven economic disruption. Sen. Elizabeth Warren of Massachusetts has separately called for an excise tax tied to the energy used by AI data centers.

Sen. Bernie Sanders of Vermont has gone further, backing a federal moratorium on new AI data center construction. Together, these proposals show the widening political gap over how to balance investment, AI competition, electricity costs, and community concerns. Trump is betting that faster growth will strengthen the economy, while critics want stronger limits or new costs before the buildout goes much further.

Local governments are drawing their own lines

San Marcos became the first Texas city to prohibit data centers in all zoning districts on June 16. Officials cited concerns about electricity and water use when approving the amendment.

Hays County later adopted a 180-day emergency water-protection review. The resolution temporarily suspends certain discretionary approvals for high-water-use projects, including data centers, while the county studies water availability and impacts.

Texas is facing a much larger pipeline statewide. The Texas Tribune identified at least 248 planned data center projects, leaving city and county decisions central to the state’s infrastructure debate.

TL;DR:

• Trump said data centers could become a bigger economic force than oil and tied their expansion to U.S. leadership in AI.
• Texas ordered an audit of data center projects moving through ERCOT’s interconnection process rather than imposing a permanent statewide construction ban.
• Federal energy data show that data centers are becoming a major driver of U.S. electricity-demand growth.
• Polls from Gallup, the University of Pennsylvania, and Reuters/Ipsos show broad concern about local projects and potential increases in electricity costs.
• The policy fight now ranges from voluntary ratepayer protections to proposed taxes and a federal moratorium, making data centers a growing political issue.

Don’t forget to follow us for more exclusive content.

If you liked this, you might also like:

• Texas data center boom faces grid and water limits
• New Orleans pauses data center growth for 1 year
• Texas data center fight escalates as Trump calls Abbott’s move a mistake

This article was made with AI assistance and human editing.