Washington's Plan to Power AI: Loosen the Rules, Bill the Allies

Commerce Secretary Howard Lutnick recently described, in plain English, how the United States intends to pay for the power plants artificial intelligence needs.

The hundreds of billions of dollars — financed by the Japanese and Koreans, meaning they give us the money, we build it here, and we split the cash flow 50-50 — Howard Lutnick

That is one half of a two-track strategy. The other half runs through Washington's own rulebook. Over the past year the administration has been stripping away the federal hurdles that slow power-plant construction: the EPA exempted islanded power plants — the kind that serve a single data center — from Clean Air Act requirements ^[1], the AI Action Plan weakened NEPA, the environmental-review law, to cut permitting delays ^[2], and the president ordered a quadrupling of nuclear capacity by 2050 ^[3]. In Texas, the state environmental agency has been accused of classifying large gas plants as minor polluters to skip federal review, clearing 108 new plants and 17 expansions ^[4]. The second track is newer and stranger: the administration is using trade leverage to get other countries to pay for American power plants. South Korea is nearing a $100 billion energy deal that includes up to eight nuclear plants and a $20 billion gas plant in Texas, built specifically to feed AI data centers ^[5]. The mechanism is a tariff threat — Washington raised the pressure by threatening to lift duties on Korean goods from 15% to 25% to force the money to actually move ^[6]. The United Arab Emirates signed an energy agreement to supply power for Microsoft's data centers ^[7]. And after a presidential visit to the Gulf, the UAE, Qatar, and Saudi Arabia pledged a combined $2.9 trillion in U.S. investment — numbers analysts describe as aspirational targets rather than binding commitments ^[8]. The foreign money is being pointed at the same states where the federal government is clearing the path. South Korea's gas plant is going to Texas — the state whose environmental agency just reclassified 58,000 megawatts of new generation as minor pollution sources ^[4]. The grid bottleneck in Virginia's Data Center Alley is pushing developers toward Texas, which Goldman Sachs ranks as the most competitive state for new buildouts ^[9]. Deregulation at home and capital from abroad are converging on the same handful of permissive places. But the friction the strategy is designed to route around keeps showing up anyway — through both tracks at once. On the domestic side, Ohio's EPA rejected blanket wastewater permits for data centers after 7,000 public comments ^[10]. Maryland enacted a permanent ban in Harford County, and Governor Wes Moore made the state's position plain.

You cannot just big foot a local jurisdiction. — Wes Moore

Even Texas Governor Greg Abbott has blocked new data centers from connecting to the state grid ^[1]. On the allied side, the pushback is quieter but just as real. South Korea denied a U.S. proposal to take a stake in Westinghouse ^[11]. Seoul's National Assembly has not yet authorized the investment fund ^[12]. And the Gulf trillions remain pledges. Treasury Secretary Scott Bessent captured how the administration reads this resistance when he suggested domestic opposition to data centers is being fed from abroad ^[13].

We can't pause. — Scott Bessent

That reframing — local objections as foreign interference — tells you the administration sees both tracks as under siege by the same thing. And it is the same thing in both places: on one side, local democracy; on the other, sovereign self-interest. Neither the federal override nor the foreign checkbook has made it go away.