PIKETON, Ohio—On the outskirts of Appalachia, the Trump administration plans to construct what could become the largest power plant and data center in the U.S. This initiative is set on a site previously involved in nuclear waste remediation.
The project, announced by U.S. Commerce Secretary Howard Lutnick to the tune of AC/DC’s “Back in Black,” has received skepticism from energy analysts who warn of potential complications. Lutnick described the swift negotiations for this massive undertaking by stating, “We’re operating in Trump time.”
In partnership with the U.S. government, SoftBank from Japan intends to establish a 9.2-gigawatt, $33 billion power plant to support a 10-gigawatt AI data center at the Piketon location. According to SoftBank, this could signal the beginning of a much larger investment, potentially reaching $1.5 trillion in several decades.
The PORTS Technology Campus, as the project is named, is notable for its scale and funding approach. Political leaders are pushing for its accelerated opening during Trump’s presidency. However, analysts caution that developers face slow processes such as obtaining permits, acquiring gas turbines, and addressing other critical details, any of which might delay the project.
SB Energy, a SoftBank subsidiary, leads the project, with plans to start data center construction this summer and aim for an 800-megawatt phase by 2028. For the power plant, SoftBank has reserved gas turbines from various suppliers, including GE Vernova.
A Department of Energy spokesperson expressed the administration’s commitment to the project, noting initial funding from Japanese partners is already secured. “The PORTS Technology Campus is shovel-ready and will deliver jobs and economic opportunities for southern Ohio,” the spokesperson stated.
Despite this optimism, experts like Ric O’Connell from GridLab criticize the economic viability due to high costs, estimating $3,586 per kilowatt, which is significantly more than previous gas plants. “As soon as Trump leaves office, the project might be significantly scaled back or canceled,” O’Connell predicts.
Regulatory filings are underway, with American Electric Power having submitted a pre-application for a 50-mile transmission line for the plant across southeastern Ohio. Already, public comments urge the Ohio Power Siting Board to reject it due to potential impacts on farms and an Amish community.
For decades, the Portsmouth Gaseous Diffusion Plant served as Piketon’s major employer, but diminished over time. The Department of Energy now manages its 3,700-acre industrial area for hazardous waste removal. The new power plant and data center will be situated nearby.
Pike County Commissioner Tony Montgomery expressed hope: “For a project like this to come back is a game changer, keeping our community viable.” Despite past failed promises, local leaders remain cautiously optimistic.
U.S. Energy Secretary Chris Wright emphasized the project’s potential for job creation and economic benefits for southern Ohio, assuring it won’t raise consumer energy bills, referencing Trump’s executive order on infrastructure costs.
Despite assurances, energy analysts caution that increased demand will inevitably affect gas prices. Mike Hogan from the Regulatory Assistance Project foresees significant cost increases for consumers, citing a “Sherman tank-sized hole” in the protection plan for ratepayers.
An Unusual Trade Deal
The power plant and data center stem from trade discussions between the Trump administration and Japan. Japan agreed to invest $550 billion in U.S. projects, receiving tariff reductions in return. Details of the deal, described in a memorandum of understanding, specify profit-sharing terms and indicate a loan-like arrangement rather than direct investment.
The arrangement is a shift from typical U.S.-Japan investments, with both governments playing key roles, noted Mireya Solís from the Brookings Institution. She remarked on the lack of precedent for such an agreement.
The Peterson Institute for International Economics questioned the feasibility of these hastily negotiated deals being fully realized.
A Really, Really Hard Thing
Despite full funding, the power plant faces logistical and regulatory challenges. ClearView Energy Partners identified supply chain issues and grid connection delays as possible hurdles.
Timothy Fox from ClearView highlighted the ambitious nature of the project but warned, “Accomplishments don’t necessarily follow ambition.” He raised concerns about securing gas turbines and natural gas supply, given high regional demand.
Energy experts like Susan Tierney from Analysis Group highlighted the need for extensive technical coordination, including grid connection approvals and addressing local contamination concerns.
Inherent Risk
The completion of both the power plant and data center is uncertain due to regulatory and logistical hurdles. Hogan compared the project to previous boom-and-bust cycles in the power sector.
“The parallels are kind of spooky,” he said, noting potential changes in the AI economy that could impact demand. O’Connell from GridLab criticized the rush to build as shortsighted, with cheaper alternatives available.
Original Story at insideclimatenews.org