Trump's trade advisor says Big Tech must 'internalize the cost' of AI data centers

The Biden administration is considering measures that would require major technology firms to bear the financial burdens associated with the rapid expansion of AI data centers. Peter Navarro, a trade advisor under former President Trump, expressed on Fox News' "Sunday Morning Futures" that companies responsible for these facilities must 'internalize' the expenses related to electricity, water, and the strain on power grids. Navarro emphasized that taxpayers should not be left to deal with the repercussions of the AI surge. He stated, "We need to ensure that the American public is not negatively impacted." His remarks arrive as the rising costs of utilities have come under increased scrutiny, particularly in light of the massive investments tech giants are making in AI infrastructure. For instance, Meta has committed a staggering $600 billion to enhance AI technologies and related infrastructure, while Apple recently announced an additional $100 billion commitment to its US infrastructure, bringing its total to $600 billion. The landscape is further complicated by rising energy costs. According to a recent report by PowerLines, utilities requested $31 billion in rate hikes last year, significantly up from the previous year’s $15 billion. Many energy providers attribute this surge in costs to the growing electricity demand from large-scale data centers. President Trump has voiced strong opposition to the notion of American households absorbing these increases, asserting that "big technology companies who build them must pay their own way.” Navarro also articulated the need for the U.S. to expand its data center capabilities to maintain its position as a leader in AI technology. He stated, "We must lead China and others on this front, not only for economic reasons but for national security, as AI poses significant risks in warfare." In response to government concerns, some AI companies have taken proactive steps to alleviate public worries. Anthropic announced it would cover all grid upgrade expenses tied to its AI data centers, ensuring that American ratepayers won't bear the financial burden. The company, which plans to invest $50 billion in AI infrastructure, aims to establish facilities in Texas and New York. Similarly, Microsoft has pledged to manage utility costs to offset the expansion impact on local communities. Both firms illustrate a growing recognition within the tech industry of the need to balance rapid growth with responsible management of resources.