Photo by Steve Johnson on Unsplash
 

The Chinese start-up, DeepSeek delivered a wake-up call to the tech sector, the financial markets, and the U.S. government. The company’s AI capabilities shook investors’ confidence and perceived Silicon Valley superiority with its “Sputnik Moment.”

Now, the AI race is officially on.

Companies are investing billions of dollars in AI research and development to gain a competitive advantage. A crucial factor in this battle for AI dominance is access to high-quality data and computing power. But this technology has extensive energy demands (16 times that of the typical data server).

As we’ve detailed, the U.S. could face a massive power shortfall to support its data centers. While these data centers tap into the same electric grid the rest of us use, they could soon rival entire cities in power use. That means utilities and energy generation companies will experience greater stress and heightened demand than ever before.

To address this, tech companies are beginning to house IT infrastructure in third-party data centers adjacent to power plants. This infrastructure can include servers, storage, and networking equipment. Within the industry, this is known as "co-location."

Co-location can offer a cost-effective way for companies to get access to the computing power they need to develop and deploy AI applications.

Now, if this all sounds too simple to be true, that’s because it comes with concerns. Major utilities and regulators around the country have warned that co-location could put a greater strain on the grid, place an even larger burdens on customers facing high bills while also hurting energy reliability.

The good news is there is a solution.
 

The AI Power Couple Solution

The influential think tank Rocky Mountain Institute (RMI) has just proposed a new analysis-based solution they call “Power Couples.” The RMI research shows that “Power Couples” could support tech firms and their data centers at the cutting edge of AI, all while not compromising reliability or utility customers.

In fact, RMI claims it could reduce customer bills and be more climate friendly.

According to the RMI report,

“A Power Couple is the pairing of a large electricity consumer with new-build solar, wind, and battery resources sized to meet the on-site load, all located near an existing generator with an approved interconnection.

This arrangement would trigger a fast-track approval process for connecting the new generation resources to the grid, and strict physical safeguards would ensure that the new load cannot impact grid reliability. Not least of all, costs are borne by the customers creating the demand, who can also take advantage of the modularity of clean energy technologies to reduce their exposure to risk.”

If that all sounds a bit complex – the graphic below gives us a visual breakdown.

RMI

As the RMI reports, Power Couples can allow renewable energy sites to be built near the location of an existing generator, and can then send power not needed by the general power grid to the data centers and new co-located interconnection points.

This coupling, at a minimum, allows the site to meet the needs of the AI companies and their data centers, while still delivering the power plant’s energy to customers across the grid.

This is why the Power Couple solution could be a vital piece to AI’s future. You see, in the U.S. the approval process and complexities for getting new, separate grid tie-ins can take years (if not decades) to develop and build – yet the AI race is happening today.

According to the Lawrence Berkley National Lab, the average wait time is five years in order to have a facility connected to the grid. In AI terms, that might as well be a lifetime – and a tech death sentence.

RMI

And while regulatory obstacles still exist in some areas, select states like Texas do not restrict new power generation with existing gas plants.

This shows potential for not only growth, but for the next phase in the AI-energy race.
 

Here's Why AI Power Couples Can Solve National Security Concerns

Yes, companies with direct access to high-quality data and computing power will be positioned to successfully develop and deploy AI applications. But so will governments.

In the U.S., AI has emerged as a critical force shaping the national security landscape. The U.S. government not only recognizes the transformative potential of AI, but it is prioritizing its development and integration across various sectors to maintain a strategic advantage in an increasingly complex and militarized world.

According to my contacts on the Hill, a large bi-partisan consensus is willing to come together on matters surrounding AI and national security issues.

And while there are a multitude of reasons why AI is vital to national security, five core areas have emerged.
 

5 Ways AI is Crucial to U.S. National Security:

1. Enhanced Cybersecurity: AI algorithms can help analyze vast amounts of data to detect and respond to cyber threats in real-time. Generative AI’s ability to identify patterns and anomalies, can help prevent cyberattacks, protect critical infrastructure, and safeguard sensitive data and information.
2. Improved Intelligence Gathering: AI-powered systems can unpack massive datasets from various outlets to identify potential threats and provide valuable insights for military and intelligence agencies. This can help prevent terrorist attacks, track the movement of hostile actors, and anticipate geopolitical events.
3. Autonomous Weapons Systems: AI will continue to enable autonomous weapons systems developments that can make decisions without human intervention. While this is highly controversial, these systems could revolutionize warfare by increasing speed and efficiency – all while reducing human casualties.
4. Economic Competitiveness: AI is seen as a key driver of economic growth, and the U.S. government recognizes the importance of maintaining a competitive edge. By investing in AI research and development, the government can support the creation of new jobs, push innovation, and ensure that the U.S. remains a global leader in AI both in the private and public sector.
5. Maintaining Military Advancements: AI is being integrated into all aspects of U.S. defense, from weapons systems to logistics and training. By continuously building out a robust technological advantage in AI, the U.S. is working to ensure that its military remains at the forefront of global defense.

Because of the Power Couple solutions, the approach could be one step toward solving national security concerns posed by AI.

With President Trump’s declaration of a National Energy Emergency and the Executive Order working to remove barriers to U.S. leadership in AI, Power Couples can jumpstart the required energy process, sending it into overdrive. These efforts could be well-received by the general public, by the private sector and by investors looking for positive signals.

Already, the Federal Energy Regulatory Commission is launching a review of co-locating data centers which could result in accommodative policies for Power Couple opportunities with AI-driven data centers. Because Texas has an accommodative regulatory environment for Power Couples, companies like Sempra (SRE), which owns Oncor Electric Delivery, and CenterPoint Energy (CNP), which provides energy to Houston, are well positioned to be pioneers in the effort.

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