As tech titans invest billions into data centers and high-tech computer chips to fuel their AI ambitions, concerns are building over energy costs, especially in communities where data centers pop up.
Microsoft says it will pay its own way.
The Redmond-based tech giant on Tuesday unveiled a five-point plan it expects to abide by as it expands its AI infrastructure:
* Microsoft will pay higher utility rates to cover the electricity costs of its data centers.
* Microsoft will minimize water use and replenish more than it uses.
* Microsoft promises construction and ongoing operations jobs in data center communities.
* Microsoft will add to the tax base of data center communities and won't ask for local property tax subsidies.
* Microsoft will invest in local AI training and nonprofits.
The plan is a recognition that as a nation we've been here before," Microsoft President Brad Smith said in an interview with The Seattle Times. "When you look at the construction of railroads, power plants and airports across the country, we've always been challenged with how to keep our infrastructure up to do date. This is the right thing for a company like us to do."
The company says the plan is community-based, addressing the concerns it's hearing from the cities and towns in which Microsoft has data centers as well as from the communities it's looking to expand into.
Microsoft, which has injected AI technology into the suite of software and hardware products it sells, likens the AI boom to the adoption of electricity.
Microsoft also has a vested interest in AI's growth, aside from trying to sell corporate customers on Copilot-equipped Word and Excel products. For the company's bet on the technology to pay off, it's relying on mass adoption and an autonomous network of robots chatting across computer systems and the internet.
But Smith is hearing the chatter and the questions about AI's burden on the electric grid in real life. He said during two recent trips to his home state of Wisconsin, the top two questions were about jobs and electricity.
Before the AI boom, when the cloud-computing revolution fueled a rise in data center construction, tech companies faced criticism over tax subsidies that ultimately may have not resulted in many jobs.
Smith and company are committed to the idea that more jobs will come, especially during the construction stage. Smith wrote in a company blog post Tuesday that the rapid demand for skilled labor is set to outpace the available pipeline of workers.
The company is leaning into public-private partnerships to fill that demand, working with the federal government to champion a national apprenticeship and workforce development initiative for young workers near AI infrastructure projects.
"These are good jobs. At the construction level they're high paying, skilled labor jobs," Smith said. "And it's important for Microsoft and other tech companies to do more for local residents to fill these jobs."
For Microsoft, the expense of some of these commitments likely won't come from the same pool as the capital expenditures the company is pouring into its AI infrastructure. Rather, it will be operational expenses that include the company's higher electricity rates it plans to adopt with data center expansion.
"We need to recognize reality. The public will not and should not expect a future where taxpayer dollars are subsidizing companies that are making center investments," Smith said. "We cannot protect the public from every source, but we should protect them from data center usage.
© 2026 The Seattle Times. Distributed by Tribune Content Agency, LLC.
