President Donald Trump’s administration has canceled a $4.9 billion loan guarantee for a major power line project that would have helped supply electricity to new data centers, raising questions about his commitment to winning the global AI race.
According to Politico, the Energy Department ended support for the Grain Belt Express project, an 800-mile transmission line meant to carry mostly wind-generated power across four states. This decision came on the same day the White House released its plans to lead in artificial intelligence by expanding the power grid, despite Trump’s own embarrassing AI mishaps.
“You can’t have it both ways,” said Republican Sen. Thom Tillis of North Carolina, suggesting Trump is sabotaging his own agenda. “If you can’t transmit electrons reliably and efficiently, then you’re not going to have energy-intensive industries relying on it.”
New data centers need more power as AI demands grow
The Grain Belt Express would have been able to transport enough power for 50 of Trump’s planned data centers, according to project developer Invenergy. The power line would have connected four regional grids and was expected to save U.S. consumers in 29 states about $52 billion on their energy bills.
The project had already received permits from all four states it would cross and was ready to start construction next year. It would have run from Kansas, where there is extra wind power, to Missouri, Illinois, and Indiana, where electricity demand is increasing rapidly.
Business leaders are worried about the impact of this decision. Ray McCarty, who leads Associated Industries of Missouri, said some of his members are already losing opportunities to build data centers because they can’t guarantee enough electricity, a problem the Grain Belt Express could have solved.
Republican Rep. Erin Houchin from Indiana supported the project, pointing out that China is quickly building the transmission infrastructure needed to win the AI race. She emphasized that expanding power infrastructure is crucial for Trump’s goal of American energy leadership.
The Energy Department said it canceled the loan guarantee because federal support wasn’t necessary for the project, reflecting Trump’s pattern of contradictory policy decisions. Missouri Senator Josh Hawley, who opposed the project, said he wasn’t worried about how this would affect the administration’s AI efforts, claiming his state would get very little benefit from it.
However, power experts warn that the U.S. needs thousands more miles of transmission lines to meet growing demand. Last year, the country built only 322 miles of high-voltage lines, which isn’t enough to keep up with the increasing power needs of new technology and industry.
The decision seems to conflict with the White House’s new AI Action Plan, which calls for faster permits to build new infrastructure and makes federal lands available for data centers and power generation. This contradiction has left many lawmakers and industry experts questioning the administration’s strategy for achieving its AI goals.
Published: Jul 24, 2025 07:59 am