A 2nd Trump term might completely reshape the data center industry

A second Trump presidency could bring significant changes to data center industry regulations, energy policies, and domestic semiconductor production, with implications for the sector’s growth trajectory and technological leadership.

Policy shift implications: The return of Trump administration policies could reshape key aspects of data center operations and development in the United States.

• Energy regulations are expected to be relaxed, potentially easing restrictions on power consumption and generation methods for data centers
• Domestic semiconductor production could receive renewed focus, affecting supply chains and infrastructure development
• Construction regulations may see broader deregulation, as indicated by positive feedback from the Associated Builders and Contractors

Industry growth dynamics: The data center sector’s expansion appears poised to continue regardless of political leadership.

• Increasing adoption of artificial intelligence and generative AI technologies continues to drive demand for new data center construction
• Power consumption needs are expected to maintain their upward trajectory, requiring solutions for energy delivery and capacity
• Infrastructure development may accelerate under potentially streamlined regulatory frameworks

Expert perspectives: Industry leaders anticipate significant focus on maintaining U.S. technological leadership.

• JLL’s Andy Cvengros emphasizes the likely prioritization of AI leadership under a new administration
• The need to address power transmission challenges remains critical for sustained industry growth
• Construction industry representatives view potential regulatory changes favorably for development prospects

Technical challenges: Core infrastructure hurdles persist regardless of administrative changes.

• Power transmission capacity continues to be a limiting factor for new data center development
• Energy generation must scale rapidly to meet growing demand from AI and cloud computing
• Domestic semiconductor production capabilities require substantial investment and development time

Market implications: A shift in federal policy direction could create new opportunities while raising certain concerns.

• The data center industry faces a complex balance between potential regulatory relief and the need to address fundamental infrastructure challenges
• While deregulation might accelerate development in some areas, the sector’s growth ultimately depends on solving critical power and supply chain bottlenecks

Strategic considerations: The intersection of policy changes and market forces will likely shape industry development patterns.

• Large-scale infrastructure projects may benefit from streamlined approvals and reduced regulatory oversight
• Energy sector policies could influence data center site selection and development strategies
• Domestic manufacturing initiatives might alter equipment sourcing and supply chain dynamics

Long-term outlook: While administrative changes may affect industry dynamics, fundamental growth drivers remain strong.

A potential second Trump presidency could accelerate certain aspects of data center development through deregulation, but the industry’s core challenges around power infrastructure and technological leadership will require sustained, long-term solutions regardless of political leadership.