Siemens Energy said Tuesday it will invest $1 billion to expand the power grid and gas turbine manufacturing in the united states as increased electricity demand from data centers and artificial intelligence strain the country’s energy infrastructure.

The investment is expected to create more than 1,500 highly skilled jobs in manufacturing, engineering and operations as Siemens Energy increases production capacity and labor levels in the US

The move comes as major tech companies are pouring hundreds of billions of dollars into new data centers in the US, sparking a sharp increase in demand for electricity that the companies say the nation’s aging power grid was not designed to handle.

Government reports have warned that data centers could account for as much as 12% of US electricity demand within two years, nearly triple their share by 2024.

CHEVRON CEO DETAILS STRATEGY TO PROTECT CONSUMERS FROM RISING AI ENERGY COSTS

Christian Bruch, CEO of Siemens Energy, speaks during the opening ceremony of the Siemens Energy transformation plant. (Daniel Karmann/Photo Alliance via Getty Images)

“Siemens Energy has been making things in America for more than a century, and we’re experiencing a once-in-a-generation growth opportunity driven by the resurgence of American manufacturing and the expansion of artificial intelligence,” Siemens Energy CEO Christian Bruch said in a statement.

Power lines on September 28, 2023, in the Everglades, Florida. (Joe Raedle/Getty Images)

Bruch said the company’s investment plans have been accelerated by political priorities focused on energy security, grid reliability and domestic manufacturing.

Growing energy needs tied to large technology projects have fueled a wave of deals aimed at adding new generation and grid capacity, though supply chain constraints, long permitting timelines and regulatory hurdles continue to hold back those efforts.

Siemens Energy said the US$1bn investment is part of a wider US$7bn global expansion plan and includes targeted upgrades to existing US facilities as well as the construction of a new network equipment factory in mississippi.

“Siemens Energy” written on a steel beam on which a power transformer sits. (Daniel Karmann/Photo Alliance via Getty Images)

Bruch said the Mississippi facility would be the company’s largest networking equipment factory worldwide and is expected to be completed by 2028.

CLICK HERE TO GET FOX BUSINESS ON THE GO

The expansion is expected to increase Siemens Energy’s overall production capacity for large gas turbines by approximately 20%.