Nearly half of all U.S. data centers planned for 2026 are expected to be delayed or canceled due to shortages of critical electrical equipment, even as billions of dollars are being poured into these projects, according to Bloomberg News.
Tech giants including Google, Amazon, Meta and Microsoft are expected to spend more than $650 billion this year on AI infrastructure. But their plans could be stymied due to limited supplies of transformers, switchgear and batteries, which are needed not just for powering AI but also for building out the electrical grid.
U.S. production cannot keep pace with surging demand for this equipment, forcing companies to rely on imports. China remains a key supplier, particularly for batteries and certain electrical components.
The constraints are already affecting timelines. Only a third of data centers expected to deliver 12 gigawatts of power capacity in 2026 are under construction, according to analysts. Transformer delivery times have stretched from about two years to as long as five, while costs have risen.
Without these components, even heavily funded AI projects cannot move forward. Analysts warn that unless supply chain issues are resolved, massive investments in AI infrastructure may fail to translate into operational capacity, potentially undermining U.S. competitiveness in the global AI race.