US AI Dream Stalls as Power, Supply, and Politics Choke Data Centers
The data center buildout that underpins the AI race is running into a hard stop across the United States. Cheap energy, open land, and sovereign certainty are drawing investment overseas, and that reality matters for national competitiveness.
Backers once called the energy and logistics play the “Power Up America” trade, betting the US could outmuscle China for AI supremacy. The recent ground truth is grim: the American data center boom is hitting a formidable wall of logistical friction.
New forecasts show a startling shortfall in 2026 capacity: nearly half of the nation’s planned 16-gigawatt capacity faces cancellation or delay, with only 5 gigawatts currently under construction. That gap isn’t just a spreadsheet problem, it’s a national security and economic one.
By 2027 the mismatch deepens: “Only about 6.3 gigawatts worth of computing infrastructure are actually under construction, compared to 21.5 announced gigawatts.” Beyond 2028 the outlook is murky, with projects delayed or never started.
“There are a further 37 gigawatts of planned infrastructure which haven’t even received a firm completion date, only 4.5 [gigawatts] of which have actually begun work.” Those numbers signal that announcements have outpaced delivery in a big way.
Many projects cite the same choke points: local permitting fights, community resistance, and a global supply chain that can’t deliver transformers, switchgear, and batteries fast enough. Bloomberg and other reporting underscores that “almost half of the US data centers planned for this year are expected to be delayed or canceled.”
“at least 16GW of data center capacity is slated to come online this year across 140 projects. 53% will be grid connected, 3% will be powered solely by on-site power, and 25% have not disclosed their powering strategies. We expect 30-50% of these projects to be delayed. Only 5GW is currently in construction.”
And the blunt assessment: “We expect 30-50% of 2026 projects to be delayed, driven by power constraints (25% of projects have not disclosed powering strategies), increasingly effective community opposition, and potential grid equipment shortages. 11GW of 2026 capacity remains in the announced stage with no signs of construction, despite typical build times of 12 to 18 months. Itʼs still possible for this capacity to come online, but it would need to dramatically accelerate.”
Some firms are trying to work around a broken grid. “On-site and hybrid power punch above their weight when measured by capacity. Grid-connected projects still lead at 40% of total capacity, but on-site generation and hybrid approaches together account for close to half of announced capacity, far exceeding their share by project count. A small number of gigascale, grid independent campuses account for this capacity, including New Era Energy & Digitalʼs 7GW project in Lea County, Homer Cityʼs 4.5 GW coal-to-gas redevelopment in Pennsylvania, and Crusoeʼs 1.8GW natural gas and renewables project in Cheyenne, Wyoming. These projects are large enough to require their own generation plant, and have the capital to fund it. Waiting for the grid to supply this level of capacity could take a decade.”
Domestic manufacturing hasn’t kept pace either, because decades of offshoring left the U.S. short on factories for key electrical gear. The spike in demand has pushed delivery times for large transformers from a year to as much as five years, and firms are scavenging refurbished transformers as a stopgap.
Goldman’s note from the field captured the mood bluntly: “there is simply not enough compute and every player is acutely compute constrained – bottlenecks from fabs to permitting for data-centers to power to memory to labor are real and are here to stay for some time to come. I wasn’t sure what to make of it – if its consensus is it peak, or is the imagination for scale of AI demand is so great among a very small sub-segment of investors & technologists here in the valley and the rest of the word is yet to catch-up?”
Political pushback is rising at the state level too. The Maine House of Representatives approved a moratorium on large-scale data centers until 2027. That pause is meant to force planning around environmental and resource impacts, and it highlights how community opposition can stall national priorities.
There’s a cultural backlash as well: between exploding electricity bills and lack of jobs for grads, a new luddite revolution is coming – they will be burning down data centers within a year
— zerohedge (@zerohedge)
Policy choices will determine whether the US can turn announcements into megawatts and racks. As Canaccord warns, “without a radical acceleration in domestic manufacturing and grid integration, the digital expansion of the late 2020s risks stalling into a series of unfulfilled promises.”
“Not only are the energy constraints mounting, but so are the sociopolitical ones. Something’s got to give.”
- UK energy prices represent a key bottleneck to AI infrastructure development. According to the report, UK’s industrial prices “are among the highest in the world” and have been a key gating factor delaying companies from building AI infrastructure. According to a spokesperson from OpenAI, “we continue to explore Stargate U.K. and will move forward when the right conditions such as regulation and the cost of energy enable long-term infrastructure investment.”
- OpenAI and Nscale maintain plans to develop the project in the future. According to the OpenAI spokesperson, “We see huge potential for the U.K.’s AI future… London is home to our largest international research hub, and we support the Government’s ambition to be an AI leader. In the meantime, we are investing in talent and expanding our local presence, while also delivering on the commitments under our MOU with the government to adopt frontier AI in UK public services.”