US federal government commits $1.9 billion in grid upgrades expected to unlock at least 23 gigawatts of additional capacity for data-center demand.

The US Department of Energy this week announced $5.25 billion in funding to support grid improvements nationwide. The program comprises $1.9 billion in federal funds and $3.35 billion in cost-share contributions, and is expected to unlock an additional 23 gigawatts of capacity across 31 specific projects in 26 states. Administered through the Speed to Power through Accelerated Reconductoring and other Key Advanced Transmission Technology Upgrades (SPARK) initiative, the funding is made available under the Grid Resilience and Innovation Partnerships (GRIP) program.

"These investments will get more out of the infrastructure we already have, move more electricity across the grid, and help deliver affordable, reliable, and secure power that will fuel American prosperity for decades to come," said US Secretary of Energy Chris Wright.

Rather than constructing new power generation capacity, the projects focus on unlocking additional capacity from existing infrastructure. The work involves reconductoring or rebuilding more than 1,500 miles of transmission lines and deploying grid-enhancing technologies—sensors, power flow control devices, and analytical tools—across 21,000 miles of American grid infrastructure. Participants working in areas prone to natural disasters will also focus on improving grid resilience and mitigating wildfire risks. The agency projects the program will improve reliability and lower electricity costs for approximately 100 million Americans.

However, the investment may not fully address the power constraints facing datacenter operators. Earlier this month, Moody's warned that the pace of datacenter construction exceeds the speed at which the US grid can add required capacity. The firm estimates that by 2030, US datacenter electricity consumption will reach 426 terawatt-hours, nearly double the 2025 figure. In response, there has been a surge in investment in alternative energy technologies, including small modular reactors, geothermal generation, and the recommissioning of aging nuclear plants. Chipmakers including Nvidia are also pushing for smarter, more connected, and consequently more efficient datacenters capable of releasing capacity back to the grid when necessary.