Study: AI buildout biggest U.S. economic bet; Valley counties brace
A Brookings paper pegs AI-related spending at $10.3 trillion through 2032 and flags financing risks. Kern has two big data-center proposals while San Joaquin County weighs new rules.
Study: AI buildout biggest U.S. economic bet; Valley counties brace
Key Takeaways
- Brookings projects $10.3 trillion in AI investment from 2025–2032, averaging 3.63% of U.S. GDP.
- The study warns risks are rising as financing shifts to leases, private credit and SPVs.
- Kern County has a proposed 275MW campus at Elk Hills and a separate 99MW project.
- San Joaquin County supervisors ordered a study and may consider a short moratorium.
San Joaquin County supervisors took a cautious first step this month, voting to study rules for AI-scale data centers before the first application hits the clerk’s desk. Board Chair Sonny Dhaliwal said the county wants protocols in place and community input, and he set the tone for a months-long review.
A new Brookings paper, presented Friday, Sept. 25, says the country is pouring more money into the AI buildout than earlier eras did into canals, railroads, electrification, highways, or telecom. The author, Columbia University’s Stijn Van Nieuwerburgh, tallies $10.3 trillion from 2025 to 2032, or an average 3.63% of GDP per year. Valley readers care because those dollars translate to power demand, water questions, land-use fights and construction jobs from Kern to San Joaquin.
Bigger than canals or railroads.
What the study projects
The paper’s core claim is simple and large: AI infrastructure spending is set to outsize past booms, with more of the financing moving off corporate balance sheets and into joint ventures, private credit, equipment leases and securitizations. That mix, the paper argues, can spread risks into corners of finance that are harder to see, even as many revenue streams for AI remain untested. Reuters, summarizing the work ahead of the conference, put the scale at more than $10 trillion and flagged potential systemic concerns if projects stumble.
Where the Valley fits
Two proposals in Kern County show how the boom could land here. Canada’s Beacon Data Centers announced plans for a 275MW campus at the Elk Hills Oil Field, with dedicated on-site power and closed-loop cooling to cut water use. A separate 99MW data center proposal in Kern includes an on-site substation, adding to the region’s grid calculus and permitting queue. It hit 90 in Bakersfield on Friday, which says something about cooling loads in late September.
San Joaquin County, by contrast, has no active applications. Supervisors voted Sept. 1 to direct staff to map the impacts of large AI facilities on electricity, water, roads and emergency services, then bring options back to the board. Staff expects roughly six months of work, and the board may weigh a 45‑day pause on approvals in October while an ordinance is drafted.
What local officials said
District Five Supervisor Robert Rickman said the lack of current applications gives the county a chance to set ground rules first. District One Supervisor Mario Gardea called the study a way to be ready before pressure arrives. Dhaliwal summed it up for the board: "We need to put our residents first."
Central Valley AI is produced by the CVAI Newsdesk team and developed by Kaweah Tech, a regional firm that builds, deploys, and integrates AI solutions for businesses across California's Central Valley.