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Trump administration pushes Big Tech toward voluntary AI data center energy pact

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The Trump administration is seeking public commitments from some of the world’s largest technology companies to a new agreement governing the rapid expansion of artificial intelligence (AI) data centers.

A draft agreement obtained by POLITICO outlines commitments designed to ensure that energy-intensive data centers do not drive up household electricity prices, strain water resources, or compromise grid reliability. The proposal also requires companies driving this surge in demand to bear the full cost of building the necessary new infrastructure.

The proposal, which remains in draft form and is subject to change, is framed as a “voluntary agreement” between President Donald Trump and major US tech firms and data center developers. The accord could bind AI giants such as OpenAI, Microsoft, Google, Amazon, Meta, and others to a broad set of energy, water, and community principles.

While the administration intends to announce the initiative during a high-profile White House event, the program has not yet been formally unveiled. It remains unclear which companies have already agreed to the terms or have been invited to participate.

This initiative represents one of the most ambitious efforts to shape AI infrastructure without imposing direct regulation. It comes just one month after the White House issued an unprecedented call to the Mid-Atlantic power grid operator to lower electricity prices. Concerns are mounting that the massive energy consumption of data centers could push prices even higher, potentially becoming a political liability for an administration that has otherwise championed rapid and unfettered data center development.

The agreement is also seen as a way to highlight efforts to mitigate the influence of these corporations ahead of the midterm elections.

“As President Trump announced weeks ago, leading tech companies are working with the President to ‘pay their fair share’ for energy consumption as they build out data centers,” White House spokesperson Taylor Rogers said in a statement. “More to come soon!”

A White House official noted that the draft is “outdated and no longer accurate” but did not specify which sections had been revised.

The decentralized nature of the nation’s power grid means that for the proposed agreement to be enforceable, grid operators, state regulators, and utility companies must agree to establish rules or draft contracts that reflect these principles.

This push emerges as utility providers, regulators, and members of Congress warn that the explosive growth of data centers—warehouse-sized buildings housing the powerful chips and servers required for AI development—could overwhelm regional power systems and inflate electricity bills for consumers already struggling with the cost of living.

Energy Secretary Chris Wright expressed awareness of these concerns on POLITICO’s energy podcast:

“People are skeptical. They think, ‘Oh my god, this is going to make the situation worse and drive up my energy prices.’ I understand their concerns. We are in a dialogue with all hyperscale developers to ensure they are not just a long-term force for lowering grid prices, but also a short-term force for halting current price increases.”

Major tech companies, known as “hyperscalers,” are building increasingly large data centers to process advanced AI computations. At the core of the agreement is the requirement that AI data center developers pay 100% of the costs for the new electricity generation needed to serve their facilities.

The agreement also stipulates that companies sign long-term electricity contracts to ensure other customers are not left with the bill if a data center fails. Similarly, tech companies would commit to paying the full cost of any current or future transmission upgrades required to connect new data centers to the grid.

In parallel, tech companies would agree to cooperate with federal, state, and local regulators to set power and transmission rates that are “neutral in every way” and ideally lower residential electricity prices in the regions where they operate. To prevent companies from outsourcing these impacts, the principles would apply not only to data centers they own but also to capacity they lease or operate from third parties.

Electricity costs are already on the rise, having outpaced the rate of inflation last year. Utilities have requested record-breaking price hikes, and government data predicts that costs will continue to climb in the coming years.

Microsoft recently made a similar set of commitments, stating it would pay more for the electricity serving its data centers, cover additional infrastructure costs, and reduce water consumption. Microsoft also announced it would no longer accept local tax breaks—a measure not included in the White House draft agreement.

In a post on Truth Social last month, Trump praised Microsoft’s announcement and indicated he was working with other tech companies to ensure “Americans do not pay the bill for their electricity consumption.”

The federal government predicts that energy demand from data centers could triple between 2025 and 2028. This surge is believed to be driving up prices in the power grid covering parts of 13 Mid-Atlantic and Midwestern states.

A 2025 Bloomberg analysis found that electricity prices rose in areas immediately surrounding data centers, while a separate 2025 report from the Harvard Law School Environmental and Energy Law Program found that consumers were bearing the infrastructure costs of serving these facilities.

However, the White House and industry allies argue that data centers are not the culprits and could actually be a significant force for lowering electricity prices. A report released last week by the Edison Electric Institute, a trade group representing investor-owned utilities, argued that costs have not increased in most areas where data centers are located.

According to the report, well-designed data center tariffs and agreements that place more responsibility on Big Tech for new energy generation and infrastructure could help lower consumer costs. However, this requires state utility regulators to draft tariff agreements and electricity contracts that fully account for the costs incurred by tech companies.

Secretary Wright highlighted two states experiencing the largest spikes in electricity demand due to data center developments without corresponding price increases. North Dakota has seen an approximately 35% increase in electricity demand over the last five years, and Georgia has implemented price freezes.

“Nominal electricity prices in these states have not increased. The real price of electricity has dropped significantly during this five-year period,” Wright said. “You will see more explanations. You have likely heard of Google’s deal in Georgia, which froze electricity prices for three years. Later this year, you will hear about agreements where major data center investments are announced in proportion to a decrease in electricity prices.”

Other companies maintain they are already covering their own costs. Meta, for instance, stated it covers all its energy costs and pointed to a study it commissioned last year showing that the clean energy projects it supports provide additional generation without increasing costs for taxpayers.

The draft also integrates data centers more directly into grid reliability planning. Signatories would commit to using non-critical backup generation at new and existing facilities, in coordination with grid operators, to support stability and reliability during emergencies.

Companies would also agree to voluntarily allow the curtailment of new data center loads when necessary to ensure reliable electricity for American households—a growing concern for grid operators facing rising peak demand and extreme weather events.

The concept of grid flexibility and backup power is gaining traction in policy circles. Last year, Texas lawmakers passed a landmark bill requiring large power users, such as data centers, to reduce power or disconnect from the grid during emergencies. Other states and grid operators are exploring similar programs. During last month’s winter storm, Wright also called on grid operators to secure backup power from data centers.

Beyond energy, the agreement aims to address local opposition in rapidly growing data center hubs. Hyperscalers would commit to developing or securing sufficient water resources to support new facilities and ensure no negative impact on local water availability or quality.

The agreement also encourages companies to establish AI education awareness programs in surrounding communities and public schools and to adopt best practices to mitigate noise, traffic, and other disruptions affecting nearby residential areas.

The deal could be significant for companies seeking federal assistance to speed up grid connections—a major hurdle for AI infrastructure projects. In the draft, the federal government commits to supporting the expedited connection of new data centers to the bulk power system that transmits high-voltage electricity across regions.

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Trump administration targets 60 nations with new tariff draft under Section 301

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The US administration is proposing new tariffs of at least 10% on imports from 60 trading partners, following an investigation into goods allegedly produced using forced labor.

According to a Bloomberg report citing sources within the Office of the US Trade Representative (USTR), the specific tariff rates will vary based on individual countries’ legislative frameworks regarding forced labor and their capacity to enforce those laws.

Under the drafted regulations, a 10% tariff rate will apply to imports from the European Union, Mexico, Canada, the United Kingdom, Taiwan, and several other nations. Conversely, goods arriving from China, India, Japan, South Korea, Switzerland, and Brazil will be subject to a 12,5% tariff.

The USTR stated that the lower tariff rate will apply to products from nations that prohibit forced labor or have committed to doing so. The agency emphasized that states failing to establish such prohibitions or lacking the capacity to effectively enforce them will face the higher tariff rate.

Bloomberg reported that this step represents a continuation of President Donald Trump’s policy to reinstate across-the-board tariffs on all countries, which had previously been ruled unconstitutional.

The proposed tariffs are the result of investigations initiated under Section 301 of the Trade Act of 1974.

Commenting on the development, Deborah Elms, Head of the Trade Policy Group at the Hinrich Foundation in Singapore, said, “This is highly significant because Section 301 is an extremely powerful tool and is highly unlikely to be overturned. This opens the door to a range of new tariff and non-tariff measures.”

The report noted that the tariffs are being introduced at what could be a turning point for the global economy.

Financial markets are already navigating a sensitive period due to rising gas and oil prices driven by conflict in Iran.

The new tariffs will not take effect immediately. Before implementation, a review and evaluation period will be conducted, which may lead to modifications in the draft proposal.

According to the timeline reported by Bloomberg, written comments on the tariffs must be submitted by July 6. Additionally, the Section 301 Committee is scheduled to hold a public hearing on July 7.

US Trade Representative Jamieson Greer argued that forced labor practices in partner nations force American workers to compete on an unequal playing field. “We will no longer tolerate this unfairness,” Greer said.

On the other hand, the USTR proposed certain tariff exemptions that could affect apparel and textile imports. While these goods could enter the US at reduced tariff rates, quotas would be determined based on the respective countries’ existing textile exports to the US.

Beef, tomatoes, bananas, coffee, orange juice, and several other food products will be entirely exempt from the tariffs. Furthermore, double taxation will not be imposed on metals, specific fuel types, and chemicals that are already subject to other duties.

In May, the US Court of International Trade ruled that the 10% tariff on foreign imports promoted by President Donald Trump was unlawful. Defending the White House’s objectives following the court ruling, Trump characterized the judges as “radical left-wing” and remarked, “Nothing surprises me. We always find different ways. We make a decision and act in another way.”

In February, the US Supreme Court also ruled that tariffs established by Trump were contrary to the law. The court concluded that the president had exceeded his authority in imposing those duties. Trump, however, claimed that the court was under foreign influence.

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Google seeks approval to release 32 million mosquitoes in US disease-control project

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Google is seeking federal approval to release nearly 32 million mosquitoes in California and Florida as part of a biological pest-control initiative known as the Debug project.

The little-known program aims to combat disease-carrying mosquitoes by releasing millions of sterile male mosquitoes into the environment, an approach designed to stop “bad bugs with good bugs.”

According to the US Centers for Disease Control and Prevention (CDC), mosquitoes are classified as the world’s deadliest animals. Of the more than 3,500 mosquito species that exist globally, only Aedes aegypti is responsible for transmitting dengue fever, Zika virus and chikungunya, diseases that sicken hundreds of millions of people each year.

In a statement published on the official website of the Debug project, Google described the issue as a difficult problem to solve, noting that many mosquito-borne diseases lack effective vaccines or treatments.

The statement argued that relying on pesticides is not a sustainable solution because such chemicals become less effective over time and can be toxic. It also said that eliminating standing water alone is insufficient because it is impossible to identify every breeding site used by mosquitoes.

For those reasons, Google said a new approach is required and that it found a solution in what it describes as “good” mosquitoes of the same species.

The project website explains the method as follows:

“Good bugs are the same mosquito species as the bad bugs that spread disease. Our good bugs are male mosquitoes carrying Wolbachia, a naturally occurring bacterium found in nature. This bacterium prevents them from producing offspring with wild female mosquitoes. Male mosquitoes do not bite and cannot spread disease, so the good bugs will stop the bad bugs from reproducing. Over time, fewer bad mosquitoes will remain.”

Scientists involved in the Debug project emphasized that the technique relies entirely on a naturally occurring bacterium, contains no chemicals or toxins, and does not involve genetic modification.

Researchers said similar approaches have been used safely for decades to control other pests. They added that the Debug team is combining scientific and engineering expertise with support from international partners in an effort to suppress disease-carrying mosquito populations.

Project scientists said their approach differs from previous eradication programs because it applies the Sterile Insect Technique on a larger scale through the use of data analytics, sensors and automation.

According to information published in the project’s frequently asked questions section, program officials are working closely with national and local governments, community leaders and research institutions.

Officials said they meet with residents in areas targeted for deployment before operations begin in order to better understand local concerns and priorities.

Google is therefore continuing to pursue federal authorization to implement the project in both California and Florida.

A notice published in the Federal Register shows that the US Environmental Protection Agency (EPA) is reviewing Google’s applications for an Experimental Use Permit under the Federal Insecticide, Fungicide, and Rodenticide Act.

According to details contained in the filing, nearly 16 million mosquitoes would be released in Florida during the first year of the project.

A further 16 million mosquitoes would be released in California during the second year.

Members of the public can obtain additional information and submit comments through the federal rulemaking portal by visiting regulations.gov and entering docket identification number EPA-HQ-OPP-2025-3951.

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US Marines test lower-cost counter-drone system to reduce missile dependence

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US Marine Corps personnel tested a new counter-drone defense system during military exercises held in the Philippines in April.

According to a report by The Wall Street Journal (WSJ), the system is designed to avoid the continuous use of expensive missiles and instead relies on a coordinated set of countermeasures.

The system consists of two armored vehicles known collectively as MADIS (Marine Air Defense Integrated System).

One vehicle is equipped with an advanced radar system, while the other carries the Stinger air defense missile system. Both vehicles are also fitted with a small cannon, a machine gun and electronic warfare equipment.

According to the report, MADIS is intended to provide military personnel with multiple options for engaging drones, including cannon fire, missiles and electronic warfare tools.

The objective is to reduce dependence on high-cost weapons when protecting military units and other strategic assets.

US Marine Corps officials told WSJ that one of the system’s most effective features is its ability to fire specially manufactured 30-millimeter ammunition equipped with precision fuzes that detonate as they approach a target.

Steven Sawyer, a former ammunition technician at the NATO Support and Procurement Agency, told the newspaper that 30-millimeter rounds are generally less accurate than missiles but are significantly cheaper to use.

Sawyer said that even if five such rounds were required to destroy a drone, the total cost would remain around $11,250.

By comparison, a single Stinger missile costs about $430,000, while Coyote interceptor missiles used in conflicts in the Middle East are priced between $100,000 and $125,000 each.

Sawyer added that 30-millimeter ammunition has proven effective against Shahed-family drones, which cannot be neutralized through electronic warfare methods.

At the same time, he stressed that US defense companies continue to face difficulties producing sufficient quantities of the ammunition. According to Sawyer, the precision fuzes are highly sophisticated electromechanical devices and only a limited number of manufacturers can produce them at scale.

WSJ noted that countering large numbers of inexpensive drones has become one of the most pressing challenges facing modern militaries.

The US military has encountered the problem directly during operations in the Middle East, where it has been forced to expend limited stocks of extremely costly precision-guided munitions.

Previously, the South China Morning Post (SCMP) reported that Chinese scientists had developed a combat algorithm known as HG-STR based on a “kill them all” concept.

The algorithm was said to enable swarms of fixed-wing drones to autonomously scan the battlefield and destroy enemy targets even if communications are disrupted and lines of sight are obstructed.

In April, The New York Times, citing three sources within defense and intelligence agencies, reported that the Pentagon assessed Russia’s and China’s drone development programs to be more advanced than those of the United States.

The assessment regarding China’s drone capabilities was reportedly based on analysis of a military parade held in China in September 2025.

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