Biden AI plan leaves unresolved questions about natural gas' role

President Biden's plan to build mega-data centers for AI and power them with low-carbon energy doesn't fully resolve questions about natural gas' role in powering AI in a climate-constrained future.

Why it matters: The executive order unveiled Tuesday morning is an important marker in the debate about AI's massive power suck and is among the first specific proposals we've seen to address it.

• But it leaves many details to the Trump administration and Hill Republicans.

Driving the news: The order lets DOE and the Defense Department lease out federal land for data centers and seeks to help construction and interconnection of clean energy to power them.

• It proposes new exemptions from the National Environmental Policy Act for the required infrastructure and sets up guardrails for how projects can be powered.
• The order defines "clean" generation as coming from renewables, nuclear and fossil fuel power plants with carbon capture technology that "achieve carbon dioxide capture rates of 90% or higher on an annual basis."
• Though that would exclude "unmitigated" natural gas that's released without being treated to reduce its environmental impact, many analysts are expecting AI's power suck to send gas demand skyrocketing.

Between the lines: Some other important details will be left to President-elect Trump — if he keeps the order in place.

• For instance, it directs DOE, Interior and other agencies to adopt categorical exclusions under NEPA that could be relevant to AI, clean power or transmission within 120 days.
• The Trump transition didn't immediately respond to request for comment.

What they're saying: Rep. Chuck Fleischmann said that in his discussion with incoming Trump officials, they're all in on powering these data centers with nuclear and gas.

• "There's absolutely no question whatsoever that … these smaller reactors will be ideal for these AI centers because of their voracious need for energy," the chair of the House Appropriations panel funding DOE told Axios on Tuesday morning.
• Johanna Neumann of Environment America, which had previously raised concerns about expediting permitting for AI, said the order "takes important steps to prevent the race to AI from becoming a race to the bottom for the environment and our health."

Zoom in: The order also contemplates a major barrier driving a backlog of power plant projects on the grid: lack of transmission and easy access points.

• DOE is required to identify "underutilized" interconnection points to help data centers plug into the grid and new power plants connect their facilities.
• The DOE will work with transmission providers and organizations near the selected federal sites to come up with needed upgrades by the end of 2027.

The big picture: The implications of this EO could ripple through the power sector.

• For geothermal, it includes categorical exclusions and other permit expediting provisions similar to what the industry has long sought from Congress.
• And it requires plans from agencies on how to deploy new nuclear.

What's next: Congress really hasn't focused on AI power use in any substantive way. Right now, that conversation usually turns back to bringing more power onto the grid via a permitting overhaul.

• "The [tech] companies are finding out they've got to have the baseload if they want to go inside the meter," Rep. Bob Latta told Axios.