Big Tech, "Build in America", and Gas Turbines: everything costs twice as much and takes five years
This is a transcript, for the video found here:
Bullets:
Energy companies and utilities are struggling to keep up with the energy demands of Big Tech firms.
Data centers and Artificial Intelligence are placing enormous strain on power grids, and Big Tech's investments in renewables aren't sufficient to keep up. Proposed nuclear power buildouts will take over a decade to bring online.
Big Oil companies see an opening for natural gas. But severe supply chain problems in gas turbines are pushing delivery dates to five years or more.
US infrastructure projects, including power generation, must comply with the "Build America, Buy America Act". All iron, steel, and construction materials are required to be of US origin.
Report:
Good morning.
The Build America, Buy America Act was part of the big infrastructure investment package passed in 2021. One of its mandates, is that on any infrastructure project in the United States that involves federal financing, all the iron, steel, and manufactured products and construction materials must be produced in the United States. No federal funds can be used for an infrastructure project that uses foreign-made components. The US doesn’t make a lot of manufactured products anymore, so regulators added this section, which says that 55% of the dollar value of manufactured components need to be sourced from the US, which allows for some wiggle room. Everything else—Iron, steel, construction materials, have to be 100% US-sourced.
The infrastructure in Build America Buy America includes electrical transmission facilities and systems, utilities, and energy distribution.
So the law on new energy projects for the United States is clear—the project needs to be American made. At the same time we now have skyrocketing demand for new power sources in the United States, driven chiefly by all these AI data centers were building. We might suppose that we should be building power plants because our household power bills keep going up, but the real motivation is that these trillion-dollar companies need more electricity for themselves. So big buildouts are coming in nuclear, so that Google and Amazon and the others can plug in their supercomputers.
But the traditional energy companies see all this as a huge new market for their natural gas. Exxon and Chevron are jumping in. Exxon announced plans to build a natural gas plant for a data center. Alphabet is Google, Amazon, Microsoft, and Meta is Facebook—they are investing heavily in solar and wind for their data centers, but it’s not nearly enough. Nuclear plants take over a decade to build, so Exxon and Chevron and fossil fuel companies are arguing that natural gas is the only thing that can get everyone over the hump in new power demand, at least anytime soon. Commercialization of small nuclear reactors, for example, aren’t going to be ready until the 2030’s, more than five years from now.
So this is a compelling new opportunity for Big Oil companies. They’ve got all this natural gas coming out of the ground, and they can just set it on fire, the electrons zip down a wire, and Amazon and Microsoft and Facebook can have all the electricity they need. But it turns out, that’s a no. Because there are big supply chain problems on the turbines everybody needs to build natural gas plants. The wait times now are years-long, and the costs are ripping higher. Depending on the model of turbine you want, it’s maybe three or four or five or seven years—no time soon, in other words. The explosion of all these data centers, again, is the key driver of new power demand. And the costs are going way higher, as well. A General Electric unit is two and a half times more expensive today, than just a few years ago.
Everything is more expensive—cost of engineering, construction cost, materials costs—pretty much everything on this list here, then, which requires a made-in-the-USA label on everything. “The higher costs reflect the wait times.”
As we should expect, this is a bonanza for the companies that build the gas turbines. Siemens North America can’t make them fast enough, GE Venova hasn’t had this much fun in the gas business since they started. The industry is bringing back “reservation fees”—these are non-refundable deposits, you put in an order today, along with a big cash deposit, and wait. Right now, it’s 2029 or 2030 before the turbine is ready to be installed. A “Five-year plus wait”—it’s 2025 now, so that’s the 2030’s. Probably the early 2030’s, compared to nuclear which will be the late 2030’s, but the takeaway here is that nobody is going to see their electric bills going down anytime soon.
Try to imagine how this all looks, to someone living outside the United States. The BRICS countries and the Global Majority countries are urbanizing, modernizing, electrifying like crazy. Electricity production in China is a parabola, compared to North America or Europe. But here are companies that everyone knows—Exxon, Chevron, General Electric, Siemens. Those are the suppliers. The customers are Amazon, Facebook, Google. Those companies have more money than many countries across the world. But it goes without saying that most companies in most countries don’t have to follow the rules in the “Build America, Buy America Act.” They can buy power generation equipment from China, and it’s on a ship in five days, and shows up - on their construction sites in five weeks. Exxon, plus General Electric, plus Amazon and Microsoft and Facebook—they need five years.
This is the Humen bridge, Pearl River, in Guangdong.
Be Good.
Resources and links:
MIT Technology Review, AI could keep us dependent on natural gas for decades to come
https://www.technologyreview.com/2025/05/20/1116272/ai-natural-gas-data-centers-energy-power-plants/
Utilities want to power Big Tech's AI ambitions with natural gas. These are the data centers they're betting on.
https://www.businessinsider.com/utilities-ai-natural-gas-power-microsoft-meta-amazon-2025-2
S&P Global, US gas-fired turbine wait times as much as seven years; costs up sharply
https://www.spglobal.com/commodity-insights/en/news-research/latest-news/electric-power/052025-us-gas-fired-turbine-wait-times-as-much-as-seven-years-costs-up-sharply
Will we have enough natural gas turbines to power AI data centers?
https://www.marketplace.org/story/2025/05/20/turbine-shortage-slows-new-natural-gas-plant-construction
Gas Power’s Boom Sparks a Turbine Supply Crunch
https://www.powermag.com/gas-powers-boom-sparks-a-turbine-supply-crunch/
Build America, Buy America in the Bipartisan Infrastructure Law
https://bipartisanpolicy.org/explainer/build-america-buy-america-in-the-bipartisan-infrastructure-law/
Build America Buy America
https://www.commerce.gov/oam/build-america-buy-america
Big Oil wants to help Big Tech power artificial intelligence data centers
Reuters, US utilities grapple with Big Tech's massive power demands for data centers
Harvard Business Review, Tech Companies, Nuclear Power, and the Problem of Strategic Timing
https://hbr.org/2025/06/tech-companies-nuclear-power-and-the-problem-of-strategic-timing
Is nuclear energy the answer to AI data centers’ power consumption?
Nuclear energy’s role in powering data center growth
China Generated More Electricity in 2024 Than the U.S., EU, & India Combined
Asia to Use Half of World's Electricity by 2025
https://www.statista.com/chart/29282/global-electricity-demand-by-world-region/
Thr Americans think they are the only ones in town. Truly an exceptionalist judeo-christian ideology mindset based on a foundation of false ideas of supremacy and moral superiority. These are built-in to their cultural values, and into every American product, policy and system.