For U.S. National Security, It’s Data Centers or Bust

The winner of the artificial intelligence (AI) race will depend on how quickly the U.S. can power up data centers, said utility executives, energy analysts and AI experts throughout the 2025 summer conference season.

“We’ve just scratched the surface of who is going to use AI,” said Maria Korsnick, president and CEO of the Nuclear Energy Institute. “Are we going to win the AI race? You have to because it’s a national security concern.”

Korsnick was one of four general session speakers discussing ways public power can prepare during June’s American Public Power Association (APPA) National Conference in New Orleans. The conversation included: Scott Corwin, president and CEO of APPA; Travas Deal, CEO of Colorado Springs Utilities; Thomas Kent, president and CEO of Nebraska Public Power District; and Joanie Teofilo, president and CEO of The Energy Authority.

Their discussion supported a similar conversation in May during CLEANPOWER in Phoenix.

“AI for the military is going to be a game changer,” said retired U.S. Air Force Gen. Charles “Chuck” F. Wald.

The former deputy commander of U.S. European Command is an expert in counterterrorism, technology innovation and international energy security policy. Wald shared a stage with Chris Womack, chairman, president and CEO of Southern Co.; and Jason Grumet, CEO of the American Clean Power Association.

In war, Wald said, information superiority wins.

The U.S. Department of Defense (DOD) agrees. President Trump’s fiscal year 2026 DOD budget request is the first in which the department has dedicated a separate budget line for autonomy and AI systems. The $13.4 billion line item includes the development, acquisition and integration of AI into the department’s defense systems and warfighting plans.

To win the AI race, experts said, the U.S. will need the right combination of new infrastructure and power generation that can support the massive load growth new data centers are expected to bring.

Southern Co.’s Womack said the U.S. must continue to be the technology leader of the world “because China’s waiting.”

Macroeconomic researcher and investor Rebecca Patterson shared more on China during APPA. The former chief investment strategist for Bridgewater Associates — the world’s largest hedge fund — said the Chinese government is working hard to accomplish a giant homecoming of the nation’s Ph.D.s in a push to beat the U.S. in the AI race. 

A Spike in Load Growth

Grumet began his CLEANPOWER opening address with the problem statement of the summer: By 2040, electricity demand is expected to increase 50%.

Paul Saferstein, managing partner and senior advisor at Ascend Analytics, explained how hyperscalers — Microsoft, Google, Meta, Amazon and Oracle — are driving load growth. Data centers used to be 5 to 10 MW, but now 100 MW is the new standard, he said. By 2035, data center demand will redefine the grid.

“The U.S. has seen decades of zero load growth, but now we’ll see 4% net load growth,” Saferstein said.

Utilities see it coming. Manuel Pineda, deputy city manager with the city of San Jose in California, said during the same APPA session that San Jose expects to build more energy infrastructure in the next five years than it has in the past 50 years to accommodate the growth.

“By 2020, we knew we had a data center problem,” Pineda said.

But it’s not all bad. There’s also a huge financial incentive to attract data centers, he said.

“That’s additional money coming in with no students and no city services. Data centers don’t really require any city services,” Pineda said.

What is needed?

“How fast can you get the power?” Pineda said. “Infrastructure. Infrastructure. Infrastructure.”

San Jose has plans for two new transmission lines, Pineda said. Originally, each line was planned as 500 MW, but both have been upgraded to 1,000 MW.

“In San Jose, we just sell the power. PG&E owns the infrastructure,” Pineda said.

He emphasized that data center owners have been willing to agree that their data centers will not be subsidized by other ratepayers.

“You don’t see this very often in California, but San Jose is open for business for data centers,” Pineda said.

Hyperscalers considering new sites place three concerns at the top: speed to market, carbon emissions and cost, Saferstein said. The middle of the country offers abundant wind and solar, but siting and interconnection remain complex. Only about 5% of potential sites are viable because of infrastructure or permitting hurdles, he said.

Still, developers and utilities are trying to scale infrastructure faster. That’s the hardest part, said Saferstein’s colleague, Paul Eory, director of resource planning.

“It’s really going to be who has the negotiating power,” Eory said. “Is it the data centers, or is it the utilities? Right now, you (the utilities) have the leverage.”

Robert LaFaso, director of forecasting and valuation at the company, said congestion in the Southwest Power Pool and Midcontinent Independent System Operator is pushing data center developers toward PJM. 

Is the Answer Nuclear?

“There will be power,” Southern Co.’s Womack said, because the economy cannot move without power.

He said the U.S. won’t be able to meet future demand without more nuclear generation, though, and the industry must tell D.C. that Americans need a comprehensive nuclear policy.

“Unequivocally, we can build big infrastructure,” Womack said. “It’s hard, but we can do it.”   

He said building new nuclear generation like Plant Vogtle in Georgia is expensive and takes years, so working across multiple administrations is a requirement. It’s time to take the politics out of nuclear generation, he said.

Korsnick, with The Nuclear Energy Institute, said there’s never been a more exciting time for nuclear. More than 350,000 nuclear workers will be needed to triple the current fleet, and not all of them will be engineers, she said.

The Energy Authority’s Teofilo said it will take diverse resources to power up data centers quickly and win the AI race. She called SMRs exciting and said gas and solar batteries are the easiest lifts for immediacy.

“Energy is cool again,” she said.