AI demand is strong; is the US also going to implement "ultra-high voltage transmission"?

AI data centers' explosive growth in electricity demand is driving the American power grid infrastructure into its largest expansion cycle in decades. According to a report by The Information on March 2 local time, in recent months, grid operators in Texas, the Mid-Atlantic, and Midwest regions have launched transmission expansion plans totaling up to $75 billion, with projects already approved by regulatory agencies. At the core are a series of ultra-high voltage AC lines operating at 765 kilovolts—the highest operational voltage currently in the US. These "electric highways" can transmit up to six times the capacity of traditional 345kV lines, making them one of the few viable pathways to accommodate gigawatt-level data centers in high-load grids. This wave of construction will see the total mileage of America's 765kV ultra-high voltage lines surge from the current approximately 2,000 miles to 10,000 miles—a fourfold increase. In this wave of expansion, the direct beneficiaries are a handful of specialized suppliers upstream in the industry chain with ultra-high voltage transmission project construction and core equipment manufacturing capabilities. $75 billion: Three major regional grids advance in parallel This unprecedented wave of ultra-high voltage transmission investment is mainly driven by three major regional grid operators, whose expansion plans have received regulatory approval. In February this year, PJM Interconnection, which covers the Mid-Atlantic region, was the first to approve a $11.8 billion high-voltage line construction plan. The project will cross Pennsylvania, West Virginia, Virginia, and Maryland, using many 765kV transmission lines. Around the same time, Texas grid operator ERCOT approved two investment proposals totaling $33 billion, covering the eastern and western parts of the state. In the Midwest, Southwest Power Pool and Midcontinent Independent System Operator have each advanced expansion projects totaling over $30 billion. Planned 765kV backbone lines will extend from Oklahoma to New Mexico, and from South Dakota to the Great Lakes region. The Information reports that Texas is also planning a third ultra-high voltage grid scheme. This will cover the state's Panhandle region, aiming to meet more than 25 gigawatts of potential data center demand in North Texas. Former Microsoft VP of Energy and now a data center site selection consultant, Brian Janous, likens ultra-high voltage transmission lines to the "interstate highways" of the grid system. He says: “Just as interstate highways make bulk goods transport possible, the grid needs high-voltage backbone lines. If you want to expand electricity demand, you must expand the high-voltage transmission network.” Texas "Panhandle Plan": New High Ground for AI Data Centers Texas’s ambitions for ultra-high voltage grid expansion are particularly notable. According to The Information, American Electric Power (AEP) has formally submitted the “Panhandle Plan” to ERCOT. The plan proposes an investment of about $10 billion to build an “AI Power Corridor” in North Texas—a wide region rich in wind and sunlight—dedicated to gigawatt-scale data centers. AEP owns and operates about 90% of the existing US 765kV network. Notably, infrastructure developer Lancium has long pushed a similar concept, and related projects are now included in AEP’s proposal. Lancium is currently building power infrastructure for Oracle and OpenAI campuses in Abilene, Texas. A consulting study commissioned by the company estimates that if the transmission network operates at full capacity, it could theoretically support up to 24 gigawatts of data center load. The study also points out that as long as data centers bear their share of construction costs, this efficient transmission model could actually lower electricity prices for ordinary Texans. Lancium CEO Michael McNamara said at an industry forum last September that with sufficient generation and transmission facilities interconnected properly, a single location could accommodate 6 gigawatts of data center load. He said: “That’s equivalent to the electricity consumption of two cities the size of Austin. This is the future we envision, and the direction we’ve been building toward.” Few Suppliers Enjoy Construction Windfalls Ultra-high voltage transmission’s highly concentrated supply chain forms strong competitive barriers; a handful of specialized builders and equipment manufacturers are the core beneficiaries of this investment wave. On the construction side, public grid giant Quanta Services has nearly built all of AEP’s existing 765kV network. With this expansion wave, the two companies have established a new strategic partnership and are entrusted to build multiple lines. Equipment supply is even more scarce. Currently, the only US factory capable of producing 765kV transformers is Hyosung HICO in Memphis, Tennessee. Last month, the factory secured a $541 million equipment order and launched a $208 million capacity expansion. After the expansion, staff will nearly double to over 800. Even so, there remains a clear capacity shortfall. HICO US head Jason Neal admitted: “Almost all our capacity for the next two years is booked... We cannot meet all demand.” Another high-voltage equipment giant, Hitachi Energy, is also accelerating expansion, investing over $1 billion to expand its US manufacturing base. Its factory outside Pittsburgh specializes in highly customized circuit breakers. Due to high technical barriers and scarce skilled labor, annual output is just a few thousand units. New Clean Energy Agreements: Tech Giants Promise Self-Bearing Electricity Costs In the broader AI power layout, tech companies are actively promoting clean energy integration. Tech giants are taking more sophisticated institutional approaches to clean energy access. According to The Information, Google and Xcel Energy recently reached an innovative agreement; using a new rate structure called the "clean energy accelerator charge", they plan to bring startup Form Energy's long-duration energy storage systems into the grid. At the core of this mechanism is cost isolation: it allows storage projects to land while ensuring ordinary users’ electricity bills aren’t affected. The agreement also includes an innovative subsidy to distribute energy storage batteries to commercial and industrial grid users most in need of capacity support. This deal will bring up to $1 billion in revenue to Form Energy. Meanwhile, the tech sector is working on policy responses to concerns about AI power consumption driving up consumer electricity prices. According to reports, several top tech companies plan to jointly announce an agreement at the White House this Wednesday, committing to ensuring ordinary consumers will not face higher electricity bills due to increased data center demand. This move largely formalizes and collectively affirms previous company promises to "bear the costs of AI infrastructure themselves". Risk Warning and Disclaimer The market carries risks, and investments must be cautious. 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