As an increasing number of AI data centers are being built, the energy supply in the United States will need to expand exponentially to meet the rising demand, according to energy industry leaders who spoke at the Western Governors Association meeting on Thursday.
The conference, held in Salt Lake City, was focused on how the West can prosper in the energy industry.
According to Charles Hua, founder of PowerLines, utilities are telling investors that they will need to spend the equivalent cost of 2,000 Hoover Dams to meet the energy supply.
On multiple panels, experts discussed the needs, challenges, and opportunities ahead for upgrading the power grid to meet the increasing demand.
The biggest issues ahead will be tight regulations and supply chain bottlenecks, but the industry experts said that achieving affordable energy and abundant energy could be mutually reinforcing.
In addition to Hua, panelists included Jeffrey Ackermann from the Center for the New Energy Economy; William Malcolm, a government affairs director for AARP; Alison Williams, senior vice president with Power for Tomorrow; and Evan Jurkovich, a vice president with Tri-State Generation and Transmission Association.
Critical minerals face supply chain issues
Currently, many of the materials and critical minerals needed for energy projects and technology are largely produced outside of the U.S.
“Minerals and mining are upstream of everything in the economy” noted Brian Somers, president of Utah Mining Association, who spoke on a separate panel at the WGA conference.
Demand for these minerals is significantly increasing, creating another bottleneck for progress, he said. “Having a facility that’s already permanent and producing more minerals … is a really critical way to solve this problem for the short term.”
New mining projects are cost intensive and take many years to build, but Somers said they then become generational assets that produce for decades.
“If we’re asking the federal government to make huge investments, we need to make sure we have welcoming regulatory environments within these states,” said Somers.
Legislation that energy leaders hope to get passed
Throughout the conference, panelists discussed legislation they believe is necessary to meet coming energy demands, including licensing and permitting reform.
Most policy recommendations focused on speed and meeting the demands as quickly as possible so building can begin.
“Energy security is national security,” noted Michael Squires, managing director of government affairs for Utah Associated Municipal Power Systems, saying he hopes that energy expenditures in the U.S. will match national security spending.