Power shortages are becoming a hidden constraint on U.S. national security.

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Editor's Note | Jeff Morgan

This study is not an energy policy initiative, nor a debate over technological routes, but rather a realistic calibration of the boundaries of national capabilities. When AI, military, and economy all depend on the same fundamental condition, electricity is no longer just a cost item, but a prerequisite for the system's operation. The purpose of this paper is to bring neglected constraints back into the decision-making purview—to facilitate cross-sectoral, deliverable action before problems can be fixed.

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(Image caption) How electricity can simultaneously support artificial intelligence, military operations, and national governance reveals that when power supply is limited, energy becomes the most implicit structural constraint on U.S. national security.

Introduction | The Crisis Hidden Behind Prosperity

In the United States in 2025, technological revolution and geopolitical tensions are accelerating simultaneously. Artificial intelligence has been formally incorporated into the core tools of national competition and industrial upgrading. From finance and manufacturing to defense systems, AI is reshaping decision-making speed and production efficiency. Multiple studies show that AI will become one of the key engines driving economic growth in the next decade, and the United States is widely regarded as a major beneficiary of this round of technological transformation.

However, behind this highly publicized technology race, a more fundamental but long-underestimated risk is emerging—power shortages.

This is not simply an energy supply issue, but an emerging systemic constraint. Electricity is the physical prerequisite for AI computing, a necessary condition for the operation of data centers, and the underlying guarantee for the immediate response capabilities of military bases, communication systems, and critical infrastructure. When the reliability, availability, and expansion rate of electricity supply begin to lag behind the growth in demand, this bottleneck will quickly spill over from the engineering level into economic risks, and further evolve into a national security issue.

U.S. electricity demand had remained relatively stable for over a decade, but this pattern has been disrupted. With the large-scale deployment of AI data centers, the simultaneous advancement of electric transportation and industrial resurgence, national electricity demand has re-entered an upward trend. At the same time, an aging power grid, lengthy approval processes, insufficient transmission capacity, and bottlenecks in the supply of critical equipment are limiting the speed of response on the supply side. This mismatch between demand and supply is accumulating a subtle yet far-reaching structural risk.

Decision-makers often focus on cyberattacks, semiconductor supply, or geopolitical conflicts, but overlook a more fundamental reality: without a stable and sufficient power supply, even the most advanced AI systems cannot function, and even the most complex military plans are difficult to implement. When energy becomes a bottleneck, the upper limit of a nation's capabilities is quietly lowered.

This article will systematically analyze from multiple perspectives how power shortages have gradually become a hidden constraint on U.S. national security. It will examine everything from the structural demand for electricity driven by the AI revolution to the military's heavy reliance on a stable power supply; from the practical engineering bottlenecks of energy transition to the widening gap in electricity and computing power with major competitors; the cascading effects of electricity prices, investment, and economic growth; and the policy options still available to the United States.

Power shortages are no longer a distant hypothesis, but a developing reality. They will profoundly impact America's technological advantage, military preparedness, and global competitive position over the next decade.

(Image caption) This map reveals the regional segmentation of the US power system and the relatively limited distribution of newly added transmission lines in recent years. For AI data centers and critical infrastructure that heavily rely on centralized computing power, insufficient transmission capacity and restrictions on inter-regional dispatch are gradually becoming key bottlenecks restricting power accessibility and national energy security.

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Part 1 | The Power Hunger of the AI Revolution: The "Invisible Battlefield" of Data Centers

The rapid expansion of artificial intelligence is pushing electricity demand to a whole new level. Unlike the digital revolutions of the past, which were primarily driven by office automation and consumer electronics, this current AI revolution is a highly concentrated, power-intensive transformation. The training and inference of large-scale models require tens of thousands of high-performance computing chips to run at full capacity for extended periods, placing far higher demands on power quality, stability, and redundancy than traditional IT systems.

In the United States, data centers have transformed from a single industry's major electricity consumer into a structural load capable of reshaping power planning. In 2024, data centers accounted for approximately 4% of the nation's total electricity consumption, a proportion expected to rise rapidly in the coming years. More alarming than the sheer volume is the concentration and growth rate of demand. A significant amount of new computing power is concentrated in a few states and a few grid nodes, placing far greater pressure on local power systems than the national average.

In northern Virginia, Texas, Arizona, and other regions, the clustering effect of AI and cloud computing infrastructure has already altered the electricity demand curve. For investors, the ability to secure sufficient power access within a predetermined timeframe is becoming a more decisive factor than land, taxes, or labor. When power access requires waiting for several years, computing power deployment must be reassessed.

Behind this energy shortage lies the inherent characteristics of AI workloads. Compared to traditional enterprise IT systems, AI training has extremely high power density and continuous requirements, with cooling, backup, and voltage regulation systems themselves constituting additional loads. Even with continuous improvements in energy efficiency, the expansion rate of model size and application scenarios may still offset the energy savings achieved by unit efficiency improvements.

Extreme weather events further amplify this risk. Regional power shortages caused by heat waves, hurricanes, and wildfires directly impact highly centralized, 24/7 data centers. Even with backup systems, frequent switching and fuel consumption quickly drive up operating costs and spill over risks to financial services, cloud platforms, and the public sector. As data centers become the core nodes of the digital economy, their vulnerability to power translates into vulnerability for the overall economy.

(Image caption) “City-level load” of power consumption at data centers: Aerial view of the Northern Virginia data center, representing a concentrated load area for the expansion of AI/cloud computing power in the United States.

At the national level, power supply capacity is reshaping the AI landscape. Computing power is no longer just a competition of chips and algorithms, but a comprehensive contest of electricity, land, cooling, and institutional efficiency. As electricity becomes a scarce resource, AI dominance will no longer depend solely on technological innovation, but on who can deliver electricity to computing power locations faster and more reliably.

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Part Two | The Fatal Weakness of Military Dependence – Electricity as the “Fifth Battlefield”

If artificial intelligence has propelled electricity to the forefront of industrial competition, then in the military system, electricity has long been an indispensable element of warfare. Modern warfare is no longer merely a contest of manpower, weaponry, and tactics, but a systemic confrontation highly dependent on information, computing, and real-time response capabilities. In such a system, electricity is no longer just logistical support, but a fundamental condition constituting combat power itself.

The U.S. defense system's reliance on a stable power supply far exceeds public perception. From domestic bases to overseas deployments, from command and control systems and intelligence analysis platforms to satellite communications, unmanned systems, and precision weapons, almost all of the U.S. military's critical capabilities are built upon a continuous, reliable, and predictable power supply. A power outage affects not only equipment operation but also the continuity of the entire operational chain.

For this reason, the U.S. military has formally incorporated power risks into its combat readiness considerations in recent years. Congress requires all branches of the military to conduct regular "black start exercises" to simulate how to restore critical systems in the event of a large-scale power outage. These exercises themselves reveal a reality: power outages are no longer considered extreme exceptions, but rather risk scenarios that must be anticipated. When military planning requires repeated rehearsals of "no-power conditions," it means that the stability of the power supply itself has become a potential weakness.

Power Vulnerability of Military Bases: From Accessibility Issues to Capability Gaps

In peacetime, power shortages may only mean inconvenience or economic loss; but in the military system, it means a decline in capability. Many U.S. military bases still rely heavily on local power grids, which themselves are under multiple pressures from extreme weather, rising demand, and aging infrastructure.

In recent years, hurricanes, heat waves, and wildfires have repeatedly had a substantial impact on military facilities. When local power grids are damaged, even if a base has backup power generation capabilities, it can often only maintain power for a limited time or with limited functionality. The seemingly disparate impacts of interrupted training activities, delayed maintenance, and reduced communication capabilities accumulate and weaken overall combat readiness.

More importantly, modern military systems have extremely high requirements for power quality. Radar, sensors, data links, and AI-assisted decision-making platforms are highly sensitive to voltage stability and continuous power supply. Even brief fluctuations can cause system restarts, data loss, or reaction delays. In high-intensity combat scenarios, such delays can be enough to alter the battlefield situation.

This is why the U.S. military has been actively promoting base microgrids, distributed generation, and energy storage systems in recent years. These measures are not simply energy-saving or environmental policies, but rather driven by strategic considerations: reducing dependence on vulnerable external power grids and improving self-sufficiency in extreme situations. However, these remedial measures also require time, funding, and equipment investment, and cannot completely replace stable, large-scale power systems.

The implicit dependence of precision weapons on AI systems

As artificial intelligence is more deeply integrated into military systems, electricity demand is amplified in new ways. AI is not only used for rear-area analysis and simulation, but is also gradually entering the realms of real-time decision-making, target identification, and tactical support. These systems share common characteristics: computationally intensive, data-intensive, and extremely sensitive to latency.

Precision missiles, unmanned vehicles, and intelligent sensing networks are all essentially "electrically powered systems." Once the power supply is insufficient or unstable, the reliability of these systems will rapidly decline. For modern military operations that heavily rely on speed and precision, this decline is not linear, but rather exhibits a critical point effect—when the reliability of the power supply falls below a certain threshold, the overall combat effectiveness may suddenly collapse.

Therefore, the impact of power shortages on the military is not limited to the logistical level, but directly concerns the integrity of combat capabilities. When energy becomes a bottleneck, military advantage is structurally weakened.

Cyberattacks and the Amplification Effect of Power Grid Digitization

(Image caption) Military resilience and microgrids: A diagram illustrating the U.S. military's deployable energy systems/microgrids, echoing the power resilience of the "fifth theater".

Another vulnerability of the power system stems from its increasing digitalization. To improve efficiency and dispatchability, the U.S. power grid is rapidly adopting smart control, remote monitoring, and automated management. While this shift improves operational efficiency, it also expands the potential attack surface.

When power grids and information systems are highly coupled, the consequences of cyber infiltration are no longer limited to data leaks, but can directly affect physical power supply. For the military and critical infrastructure, this means a new form of risk: substantial paralysis can be caused solely through digital means without destroying physical facilities.

Against the backdrop of escalating geopolitical competition, this risk is further amplified. Even without an actual attack, the long-term infiltration and testing of power grid security will force the defender to invest significant resources in monitoring and hardening. This "continuous attrition" is itself a form of strategic pressure.

More alarmingly, the widespread adoption of artificial intelligence is altering the balance between offense and defense. AI not only increases the demand for electricity and computing power on the defensive end but also provides attackers with more automated and scalable tools. As the cost of attack decreases while the cost of defense increases, the security of power systems becomes an issue that must be addressed at the national level.

Indo-Pacific Perspective: Without power grids, there is no sustained combat capability

In potentially high-intensity confrontation zones like the Indo-Pacific, the importance of power is even more pronounced. Long-range deployments, complex supply lines, and highly information-dependent operations make the reliability of logistics and infrastructure a strategic core. Any power bottleneck could directly limit operational options.

Historical experience has repeatedly demonstrated that the outcome of modern warfare often depends on sustained capability rather than a single strike. When power supplies cannot be maintained in the long term, no matter how advanced the weapons or how meticulous the plans, it is difficult to sustain high-intensity operations for an extended period. This is why energy and the power grid are increasingly regarded as the "fifth domain"—it is not entirely confined to land, sea, air, and space, nor is it merely a network, but rather a foundational layer that permeates all domains.

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Part Three | Structural Bottlenecks in the Energy Transition: The Conflict Between Green Ideals and Reality

In theory, the energy transition is seen as a long-term solution to power shortages and climate risks. However, in the current reality in the United States, this transition process is exposing a series of structural bottlenecks, which in turn amplify the risks of power shortages in the short and medium term. The problem is not whether the direction is correct, but rather the misalignment between the pace of engineering, institutional design, and actual needs.

Over the past decade, the United States has made significant progress in renewable energy technologies. The unit cost of solar and wind power has dropped dramatically, new installed capacity has repeatedly reached new highs, and battery storage has also grown rapidly. On paper, the transition seems to be progressing smoothly. However, from the perspective of power system operation, it becomes clear that this new capacity has not been fully converted into electricity that can be dispatched immediately and output stably for extended periods.

The core bottleneck of the transformation is not in power generation, but in the power grid.

One of the most easily overlooked facts about the energy transition is that breakthroughs in power generation technology do not equate to increased power supply capacity. In the United States, what truly hinders the transition process is not a lack of solar panels or wind turbines, but the power grid.

Aging transmission lines, difficulties in interstate coordination, and lengthy local approval processes prevent many renewable energy projects with completed investment decisions from being connected to the grid in a timely manner. It often takes several years from project approval to actual power transmission. During this period, demand arrives ahead of schedule—especially for "build-to-use" loads like AI data centers, which cannot wait for the grid to be gradually upgraded.

The result is a clear time mismatch:
Demand is present, supply is future; investment is on paper, electricity is in the queue.

This mismatch not only limits the actual contribution of renewable energy, but also forces the system to rely on existing reliable power sources at critical moments, further increasing the pressure on aging infrastructure.

Decommissioning outpaces replacement, putting pressure on reliability.

Driven by both transition policies and market pressures, some traditional power sources in the United States are being phased out at an accelerated pace, especially coal-fired power units. While this trend is justifiable from an environmental perspective, it presents a practical problem at the engineering level: the rate of retirement often outpaces the actual availability of replacement capacity.

(Image caption) Nuclear energy (fission) = Baseload power already in operation: Plant Vogtle Nuclear Power Plant in Georgia, symbolizing a stable power source that can provide power 24/7.

When reliable power sources fail while new renewable energy projects await grid connection, the power system is forced to operate with a smaller safety margin. This means the system is more susceptible to stress or even failure during extreme weather, equipment failure, or load surges.

Under these conditions, a tension arises between power reliability and transformation goals. Local governments and utilities face difficult choices: too rapid a withdrawal from reliable power sources increases the risk of power outages; delaying the withdrawal may lead to policy and public pressure. This dilemma itself is a result of the transformation not being fully engineered.

Political and institutional friction amplifies the difficulty of the project.

The energy transition is not a purely technical process, but a highly politicized undertaking. In the United States, attitudes toward energy projects vary greatly between different states and communities. Transmission lines often cross multiple districts, and each node can become a source of delays.

Furthermore, energy projects are increasingly becoming embroiled in partisan conflicts. Solar, wind, and energy storage projects are facing political resistance in some regions, leading to delays or even cancellations in approvals. This uncertainty directly impacts investor confidence and disrupts previously anticipated installation plans.

At the engineering level, this means a stark reality: even with ample capital and mature technology, institutional frictions can still stall projects for years. For the power system, years of delays are enough to alter the supply-demand balance, turning potential risks into actual shortages.

Critical minerals and equipment supply chain: the second hidden bottleneck

Another structural constraint on the energy transition comes from the supply chains of critical minerals and equipment. Solar panels, wind turbines, batteries, transformers, and high-voltage equipment are all highly dependent on specific raw materials and global supply networks.

As the world simultaneously advances its energy transition, demand for materials such as lithium, copper, nickel, and rare earth elements is surging. However, expansion on the supply side has been relatively slow, with mining, smelting, and processing capabilities concentrated in a few countries, increasing geopolitical risks. When supply chains experience fluctuations, the delivery time of energy projects is forced to be delayed.

Bottlenecks at the equipment level are equally serious. The long manufacturing cycles and high technical requirements of transformers and high-voltage equipment have become key factors restricting power grid upgrades in recent years. Even with sufficient funding, delays in equipment delivery can still stall the entire project at the last mile.

These bottlenecks mean that the energy transition cannot be accomplished with a single breakthrough, but is a long chain constrained by multiple links. Blockage in any link could significantly slow down the overall progress.

The intersection of transformation and national security

When energy transition intertwines with national security issues, its impact extends beyond the electricity market. Military bases, critical infrastructure, and high-tech industries are often located in areas with the highest demands for power reliability. If the pace of transition becomes unbalanced with security needs, the risks will amplify rapidly.

This is why a growing number of security and policy analyses are emphasizing that the energy transition must be based on reliability, not an idealized timeline. Before the risk of power shortages is eliminated, any actions that weaken system stability could have unbearable consequences.

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Part Four | Global Comparison – China’s Advantages and the Relative Weaknesses of the United States

When electricity begins to become a key factor limiting the expansion of AI, military resilience, and energy transition, global comparisons cease to be merely a statistical game and become a real issue directly related to national competitiveness. At this level, the United States faces a significant structural gap, while China is gradually developing a clear advantage in electricity supply and expansion capabilities.

This gap did not form overnight, but is the result of the accumulation of energy policies, investment pace, and institutional efficiency over the past two decades.

The discrepancy between total installed power capacity and expansion rate

In terms of total volume, China has become the world's largest electricity producer and consumer. Over the past two decades, its installed power capacity has expanded at a near-doubling rate, far exceeding the growth rate of the United States. By around 2025, China's total installed capacity will approach 4,000 gigawatts, while the United States will hover around 1,200 gigawatts. This gap is reflected not only in the numbers but also in the resilience and carrying capacity of the system.

More importantly, there's the speed of new installations. In recent years, China's annual new installed capacity has often been measured in hundreds of gigawatts, while the United States' new additions have been far below this level. This means that when facing the increased load brought about by AI data centers, industrial upgrading, and urbanization, China has greater "adjustment space" and can absorb demand shocks in a short period of time, while the United States is more likely to reach its system limits.

China's Advantages and the Relative Weaknesses of the United States (Electricity × AI × National Competitiveness Benchmark)

(Chart Explanation) This comparison shows that the global AI competition is shifting from a battle over algorithms and chips to a battle over electricity and infrastructure. China's advantage lies not only in its total installed capacity, but also in the speed of electricity delivery and system resilience; while the relative weakness of the United States is evolving from an energy statistics issue into a structural challenge at the levels of technology, industry, and national security.

This gap stems not only from resource endowment but also from institutional choices. China's power system construction is highly centralized, with transmission, generation, and supporting projects often proceeding simultaneously; while in the United States, power construction is constrained by multi-level approvals, local resistance, and interstate coordination, resulting in a significantly longer cycle from planning to implementation.

Differences in the pace of renewable energy deployment

China's advantages are equally evident in the renewable energy sector. The rapid expansion of its solar and wind power capacity has enabled it to establish the world's largest renewable energy system in a short period. This scale effect not only reduces unit costs but also improves the flexibility of system dispatch.

In contrast, while the growth of renewable energy in the United States is impressive in proportion, it still lags behind in absolute quantity and delivery speed. Many projects have encountered delays in the planning or construction phase, and transmission bottlenecks have prevented some of the installed capacity from being fully utilized. As a result, the on-paper increase in installed capacity has not been fully converted into readily available electricity (see the subsequent article "Cheng Maiyue: What the United States Lacks Is Not Electricity, But the Grid—Capacity Bottlenecks, Time Mismatches, and Engineering Decomposition Methods in the AI Era").

This difference is crucial for AI and data centers. Computing infrastructure requires certainty: certain capacity, certain timelines, and certain cost structures. When a country's energy system cannot provide this certainty, investment will seek other options.

Hybrid Energy Structure and Realist Strategy

Another important difference lies in the realism of its energy structure. While vigorously developing renewable energy, China has not completely abandoned traditional baseload power sources. Coal-fired power still accounts for a significant proportion of its power structure and plays a stabilizing role during peak demand periods or system strain.

(Image caption) A comparison of the power systems of China and the United States reveals a stark contrast: on one side, rapidly expanding and centrally planned high-voltage transmission and power generation facilities; on the other, a power structure constrained by institutional divisions and an aging power grid. This difference highlights that in an era where AI, computing power, and national security are highly intertwined, power supply capacity is gradually transforming into a key underlying variable for national competitiveness.

This strategy is highly controversial from an environmental perspective, but it provides strong reliability guarantees from an engineering standpoint. For data centers and industrial facilities that need to operate around the clock, stability is often more attractive than an idealized structure. This also explains why China was able to support the expansion of large-scale computing power and manufacturing capabilities in a short period of time.

The United States faces greater political and institutional constraints in its energy structure transition. The withdrawal of reliable power sources and the lag in new capacity make the system more vulnerable to shocks. When demand rises rapidly but available electricity fails to increase in tandem, the risks become acute (see his subsequent article, "Cheng Maiyue: The United States is not lacking electricity, but its power grid—capacity bottlenecks, time mismatches, and engineering decomposition methods in the AI era").

Grid efficiency and infrastructure investment

Besides power generation, grid efficiency is also a key factor affecting competitiveness. China's investment in power transmission and distribution enables it to deliver electricity from production sites to load centers with relatively low losses. The widespread application of high-voltage direct current (HVDC) transmission has reduced distance limitations and improved overall system efficiency.

The US power grid is generally aging, with high loss and failure rates in some areas. Upgrading and expanding it requires overcoming multiple institutional barriers, resulting in long investment recovery periods and numerous controversies, slowing down the process. When electricity demand suddenly surges driven by AI, this structural lag will become a competitive disadvantage.

The Triangular Relationship Between AI, Computing Power, and Energy

Ultimately, all of this points to the same reality: the AI competition is shifting from algorithms and chips to power and infrastructure. While China is still catching up in terms of computing power quality, it has established a clear advantage in power and infrastructure. This advantage is gradually translating into differences in deployment speed and scale.

When AI experts and industry professionals compare the deployment conditions of computing power in different countries, the availability and efficiency of electricity often become the most obvious differences. Whoever can deliver electricity to the location of computing power faster will gain an advantage in the next round of competition.

For the United States, this is a sobering warning. The electricity gap is no longer just an energy statistic, but is evolving into a structural challenge at the levels of technology, industry, and national security.

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Part Five | Economic Impact – From Rising Electricity Prices to Limited Growth

The impact of power shortages on the US economy is not a single-point shock, but a gradually amplifying chain reaction. It is first reflected in electricity prices, then permeates investment decisions, industrial layout, and macroeconomic growth potential, ultimately affecting the overall resilience of the economy.

Rising electricity prices: the first signs of pressure

When electricity demand rises rapidly while supply and grid expansion cannot keep up, price almost inevitably becomes the first variable to adjust. In recent years, electricity price increases in many parts of the United States have significantly outpaced the overall inflation rate, a trend particularly pronounced in states with a high concentration of data centers.

For households, rising electricity prices directly erode disposable income; for businesses, they increase operating costs and weaken expectations of investment returns. This pressure is not a short-term fluctuation, but is closely related to structural load changes. When data centers, electrified transportation, and the resurgence of manufacturing simultaneously drive up electricity demand, electricity prices are no longer merely a consequence of the energy market, but become a real constraint that economic policy must confront.

(Image caption) AI Data Center Cooling and High-Density Cabinets: The image shows liquid-cooled/high-density computing cabinets, reflecting the power and heat dissipation pressure brought by AI computing power.

More alarmingly, electricity price increases are often accompanied by political and social backlash. Local governments and utility companies are caught in a dilemma between "ensuring power supply" and "controlling costs," and this tension further slows down necessary investment decisions, creating a vicious cycle.

Investment delays and site relocation

The second impact of power shortages on the economy is reflected in changes in the pace of investment. For AI data centers, advanced manufacturing, and large-scale industrial projects, the timeline and capacity certainty of power access have become key factors in determining whether investments will be implemented.

When businesses cannot secure sufficient power supply within the designated timeframe, projects are forced to be delayed, scaled back, or even relocated to other regions or countries. This relocation is not based on labor or market factors, but rather driven by infrastructure bottlenecks.

For local economies, this means missing out on high-value-added investments and job opportunities; at the national level, it weakens the industrial cluster effect. When electricity becomes an uncertain factor, the risk premium for investment increases, and the efficiency of capital allocation decreases accordingly.

Constraints on the pace of AI innovation

Power shortages have a particularly profound impact on the AI industry. AI innovation relies not only on breakthroughs in algorithms but also on a continuous and predictable supply of computing power. When electricity costs rise or access becomes limited, companies tend to make more conservative decisions regarding model training and deployment.

This conservatism does not stem from technological bottlenecks, but rather from the uncertainty of fundamental conditions. High electricity prices and power supply risks force companies to extend their investment payback period assessments, reduce high-risk, high-energy-consuming R&D attempts, and thus slow down the overall pace of innovation.

In the long run, this will impact the United States' leading advantage in the field of AI. When innovation is forced to conform to energy constraints, competitors may take advantage of more favorable electricity conditions to accelerate their catch-up or even overtake.

Macroeconomic multiplier effect

At the macro level, power shortages weaken the multiplier effect of energy investment. Energy investment typically has a high economic driving force, not only directly creating jobs but also reducing operating costs in other industries and increasing overall productivity.

However, this multiplier effect cannot be fully realized when power supply is insufficient or unstable. Investment is delayed, production capacity cannot be brought online on schedule, and the growth of related industrial chains is also limited. This kind of hidden loss is often difficult to fully reflect in short-term data, but it will drag down the economic growth trajectory in the medium to long term.

Furthermore, power shortages can exacerbate regional imbalances. Resources and investment concentrate in areas with better power supply, while other regions face lost development opportunities, further widening the economic gap.

Social and political spillover effects

The economic impact of electricity issues will ultimately spill over into social and political spheres. As electricity prices continue to rise and the risk of power outages increases, public discontent with energy policies will accumulate. This discontent may translate into questioning of energy transition, infrastructure investment, and even the technology industry itself.

In a democratic system, such backlash directly impacts policy continuity. Energy and infrastructure projects are more likely to become the focus of political maneuvering, further delaying decision-making and implementation. As a result, problems that could have been gradually resolved through long-term planning are instead exacerbated by short-term political pressure.

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Part VI | Solution Recommendations – Synergistic Pathways for Policy, Investment, and Innovation

Power shortages are not an inevitable fate, but rather the result of a combination of policy choices, investment pace, and engineering capabilities. For the United States, the issue is not whether it possesses the technology and capital, but whether it can translate these elements into deliverable power capacity within the right window of opportunity. The solution must encompass policy, investment, and institutional innovation, with national security as the ultimate constraint.

I. Power grid upgrading should be regarded as a national strategic investment.

Of all the options, grid upgrades are the most leveraged, yet also the most underestimated. No matter how much new generation capacity is added, if the transmission and distribution systems cannot handle it, electricity cannot reach load centers. Currently, much of the US grid infrastructure was built decades ago, and its design did not take into account the existence of high-density, continuous loads such as AI data centers.

Viewing power grid upgrades as a national strategic investment means giving them higher priority in approvals, funding, and coordination mechanisms. Interstate transmission projects need streamlined processes, and key bottlenecks need to be addressed with concentrated resources, rather than being bogged down in back-and-forth at the local level. While such investments may not generate political benefits in the short term, they are a necessary prerequisite for supporting economic development and security over the next decade.

Second, the energy structure must be pragmatic and diversified, rather than following a single path.

Until the risk of power shortages is eliminated, energy policy must prioritize reliability. The expansion of renewable energy remains crucial, but its effectiveness depends on complementing, rather than replacing, stable baseload power sources. Any premature withdrawal that weakens system stability could amplify risks at critical moments.

This means the United States needs to re-examine its energy mix under realistic conditions, allowing different technological approaches to play a role at different time scales. In the short term, ensuring a stable power supply should take precedence over idealistic structural adjustments; in the medium to long term, costs and emissions should be gradually reduced through technological advancements and institutional reforms. Energy transition is not a linear replacement, but a transitional process requiring meticulous management.

Third, demand-side management and efficiency improvement are the fastest ways to achieve "virtual supply".

Given the time required for power generation and transmission infrastructure development, demand-side management becomes the most effective tool for immediate results. Through price signals, load dispatching, and energy efficiency improvements, considerable system capacity can be freed up without increasing power generation capacity.

For AI data centers, energy efficiency is not just a cost issue, but also a matter of competitiveness. More efficient cooling technologies, flexible operating strategies, and load management in sync with the power grid can significantly reduce system stress during peak periods. Promoting these measures requires a combination of policy guidance and market incentives, rather than relying solely on spontaneous corporate actions.

(Image caption) Base-level microgrids and energy security: The case of a U.S. base microgrid (Joint Base San Antonio) symbolizes the institutionalized reliance of military bases on uninterrupted power supply.

IV. Key equipment and supply chain resilience must be strengthened simultaneously.

Another real source of power shortages lies in equipment and supply chain bottlenecks. Transformers, high-voltage switchgear, cables, and critical minerals are all indispensable elements of the power system. When these components are delayed, even the most ambitious energy blueprints remain only on paper.

Enhancing supply chain resilience requires a combination of industrial policies and the development of domestic manufacturing capabilities. By incentivizing local production and diversifying supply sources, dependence on a single country or market can be reduced, and the overall system's resilience to shocks can be improved. This is not only an economic consideration but also a national security consideration.

V. Formalize power security into the national security framework

In an era where AI and digitalization are pervasive, power security can no longer be viewed as a purely energy issue. It is closely linked to cybersecurity, military resilience, and industrial competitiveness. Incorporating the power system into the national security framework means that it should be given priority in planning, drills, and investment compared to other critical infrastructure (see the subsequent article, "Cheng Maiyue: What the United States Lacks Is Not Electricity, But the Power Grid—Capacity Bottlenecks, Time Mismatches, and Engineering Breakdown Methods in the AI Era").

This includes systematic assessments of grid resilience, routine drills for extreme scenarios, and collaborative protection between the public and private sectors. As electricity is viewed as a strategic asset, its governance must also be upgraded accordingly.

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Power shortages are a national security red line that the United States must face squarely.

Power shortages are becoming an implicit constraint on U.S. national security. This is not the result of a single policy failure, but rather the product of the long-term accumulation of multiple structural factors. The enormous electricity demands of the AI revolution, the military's heavy reliance on a stable power supply, the engineering and institutional bottlenecks in energy transition, and changes in the global competitive landscape are all pushing the electricity issue to a strategic level.

The United States in 2025 will still possess ample resources, technology, and institutional flexibility for adjustment. The real risk lies not in the problem itself, but in delayed action. When electricity becomes a bottleneck, technological superiority will be eroded; when electricity becomes an uncertainty, military and economic decision-making options will be forced to shrink.

Historical experience has repeatedly shown that the decline of superpowers is often not due to a single failure, but rather to the neglect of seemingly fundamental yet crucial supporting systems. Electricity is precisely such a supporting system. It is inconspicuous, yet it determines everything.

Whether the United States can maintain its leadership in science, technology, military, and economy over the next decade largely depends on the choices it makes today: whether to view the electricity issue as a localized challenge or to acknowledge it as a national security red line that must be addressed immediately.

This red line has already appeared.
Whether or not a breakthrough is achieved depends on whether the action is timely.

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