What’s next for US energy policy after the midterm elections?

The dust is settling on the midterm elections, and the landscape looks fundamentally different than it did forty-eight hours ago. With Democrats taking control of both the House and the Senate, the pendulum has swung. For those of us building in the trenches of crypto and artificial intelligence, this isn't just a political headline. It is a direct signal about the future of the grid.

The Energy Bottleneck

If you are building anything significant in AI or blockchain today, you know that energy is the primary constraint. We have moved past the era where software was just code; today, software is a physical load on the electrical system. The previous administration focused heavily on deregulation and fossil fuel expansion. The new leadership is going to pivot hard toward the energy transition. For founders, this means the rules of the game for data centers and mining operations are about to be rewritten.

We have seen this cycle before. A change in leadership brings a change in subsidies, tax credits, and regulatory pressure. But this time, the stakes are higher because our demand for compute is growing exponentially. We aren't just talking about keeping the lights on anymore; we are talking about powering the massive clusters required for the next generation of large language models and the decentralized networks that secure our assets.

What This Means for Infrastructure

The Democratic sweep likely means a renewed push for the Inflation Reduction Act's goals, but with more teeth. We should expect a heavier emphasis on grid modernization. For a long time, the U.S. grid has been a patchwork of aging tech that can barely handle a heatwave, let alone a million new ASICs or a cluster of H100s. If the new Congress actually puts money into high-voltage transmission lines, it could be a win for builders who have been struggling with multi-year wait times for power hookups.

However, there is a catch. Skepticism toward high-energy industries is baked into the current Democratic platform. If you are running a proof-of-work operation or a massive AI lab, you are likely going to face more scrutiny regarding your carbon footprint. The "green" requirements for new builds are going to get stricter. This isn't necessarily a bad thing for the industry long-term, but it adds a layer of friction for anyone trying to scale quickly in the short term.

The Founder's Perspective

I have always believed that the best founders are those who can navigate around regulatory obstacles rather than just complaining about them. If the government is going to subsidize renewables and penalize carbon-heavy baseload power, the smart move is to align your infrastructure with that reality now. We are seeing a rise in "behind-the-meter" solutions where miners and data centers are co-locating with wind and solar farms. This trend is about to go into overdrive.

The reality is that politicians, regardless of party, don't fully grasp the technical requirements of the AI revolution. They see a power bill; we see a competitive advantage for the country. As builders, our job is to bridge that gap. We need to show that compute is a tool for innovation, not just a drain on resources. If we don't, we risk being the scapegoat for any grid instability that happens over the next two years.

Policy Uncertainty and the Market

Markets hate uncertainty, but they also hate stagnation. The previous two years were marked by a lot of talk and very little movement on actual energy permitting reform. With a unified government, the Democrats have the opportunity to actually pass legislation. Whether that legislation helps or hurts the tech sector depends on how well the industry can lobby for its place as a strategic national interest.

We should keep a close eye on the Federal Energy Regulatory Commission (FERC). This is where the real battles are fought. The people appointed to these roles will decide how easy it is to move power across state lines. If you are building a decentralized physical infrastructure network (DePIN), these bureaucratic shifts are more important than the price of Bitcoin today.

• Grid Access: Expect more funding for transmission, but more red tape for non-renewable sources.
• Tax Credits: Incentives for clean energy will stay, but expect new reporting requirements for energy-intensive businesses.
• Regulatory Oversight: Increased focus on the environmental impact of data centers and mining facilities.

Looking Ahead

The blue wave isn't a death knell for high-compute industries, but it is a wake-up call. The days of cheap, dirty, and unregulated power are coming to an end. The winners in the next cycle will be the companies that can prove their efficiency and integrate directly with the new energy economy. We are moving into a phase where energy policy is tech policy.

For those of us in the room, the strategy stays the same: build for resilience. Don't rely on a single regulatory environment or a single source of power. The more modular and adaptable your infrastructure is, the less you have to worry about who holds the gavel in D.C.

The energy transition isn't just about the climate; it is about who has the right to use the limited electrons we have available.

As the new Congress takes shape, we will see a flurry of activity. Some of it will be performative, but some of it will fundamentally change the cost of doing business. My advice is to watch the permitting reform closely. If we can't get permission to build the wires, it doesn't matter how many chips we have. The bottleneck is physical, and the solution is political.

The Takeaway

The midterm results signal a massive shift toward a green-energy-first policy. For AI and crypto builders, this means the era of easy power is over, and the era of efficient, integrated energy strategy has begun. Align your infrastructure with the grid of the future, or get left behind in the dark.

Read the original at MIT Technology Review →