Microsoft’s President Brad Smith announced a new framework for how the tech company will build and operate artificial-intelligence (AI) data centers across the United States, including a commitment to absorb infrastructure and energy costs to make sure consumers are not paying more in electric bills over increased demand for Microsoft’s data center.
The initiative was unveiled in a speech on Tuesday to a Washington, D.C. audience of policymakers, and comes as lawmakers and local officials increasingly scrutinize the expansion of energy-intensive data centers required to power advanced AI.The framework could become a template for the industry, a Hill source told the Washington Reporter.
“This is exactly what we need, the economic growth and benefits of AI dominance against China, while not having the costs pushed on middle class Americans. Good for Microsoft to be a leader and a model for the rest of industry to follow,” the source said. “This type of announcement makes it more likely that the Hill can pass a preemption law to stop California and Illinois from gutting this sector.”
President Donald Trump praised Microsoft and the company’s new approach ahead of the speech, with a Truth Social post announcing: “First up is Microsoft, who my team has been working with, and which will make major changes beginning this week to ensure that Americans don’t ‘pick up the tab’ for their POWER consumption, in the form of paying higher Utility bills. We are the ‘HOTTEST’ Country in the World, and Number One in AI. Data Centers are key to that boom, and keeping Americans FREE and SECURE but, the big Technology Companies who build them must ‘pay their own way.’ Thank you, and congratulations to Microsoft.”
According to the post, Microsoft committed to a five-part approach that includes paying the full cost of electricity it consumes, and more.
“This Community-First AI Infrastructure Initiative provides a framework for doing exactly that. It is anchored in five commitments, each a clear promise to the communities where we build, own, and operate Microsoft datacenters. These are: We’ll pay our way to ensure our datacenters don’t increase your electricity prices; We’ll minimize our water use and replenish more of your water than we use; We’ll create jobs for your residents; We’ll add to the tax base for your local hospitals, schools, parks, and libraries; We’ll strengthen your community by investing in local AI training and nonprofits.”
Trump’s post praising Microsoft was amplified by Sen. Tom Cotton (R., Ar.) who added, “I agree with President Trump, AI dominance can’t come with higher energy costs. Last week, I introduced the DATA Act which would allow data centers to be powered by off-grid power plants. I’ll continue working with the Trump administration on this important issue.”
The announcement follows months of public concern over whether AI-driven data-center growth could drive up electricity prices for households and small businesses. Reports have warned that unchecked expansion could place significant strain on local grids, particularly in fast-growing regions already facing energy constraints.
The Washington Reporter has extensively covered the debate around AI legislation and will have additional scoops in the coming weeks.