Meta's Martin Urges Preemption of State and Local AI Rules
Congress made the right move by forestalling state or local regulation that could have held up development and deployment of the internet, and similar approaches might be warranted for AI, Meta Head of Global Policy Kevin Martin said Thursday. Pointing to the federal moratorium on state and local government taxation on internet access and the restrictions on taxes on e-commerce, the former FCC chairman said a similar moratorium on AI, an inherently interstate service, would give the federal government time to study AI oversight and make recommendations. Martin was speaking at Incompas’ policy conference in Washington. Much of the Incompas event revolved around permitting related to AI and data centers, particularly energy permitting.
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Martin said 1996's Telecommunications Act also made clear wireless is an interstate service not subject to direct state regulation, and that allowed for more rapid deployment. That type of approach also could make sense for AI deployment, he said.
The U.S. leads China in AI “by months, not years,” said Rep. Jay Obernolte, R-Calif. He said the U.S. has more advanced chips and software, plus a culture of innovation and entrepreneurship. Meanwhile, China has centralized planning and coordination of its economy that's letting it build huge amounts of power generation, said Obernolte, who co-chaired the Bipartisan House Task Force on Artificial Intelligence last session. He said a big constraint on AI deployment in the U.S. will be energy supply, requiring some kind of changes to the energy permitting regime.
Obernolte said he hoped there’s bipartisan support for a national AI framework. Business hates uncertainty, and there can't be a regulatory environment where rules radically change when different parties take power, he said. Obernolte said the E.U.’s highly centralized AI regulatory approach is driving talent and investment capital to flee to the U.S. and U.K. The U.S. needs to take a decentralized approach, he said, and Commerce’s Center for AI standards and innovation should craft a “regulatory toolbox” that can be handed to federal regulatory agencies to use when there’s some AI application in their sectors.
Obernolte said there’s a need for a preemptive framework for state AI regulation. States have a role to play in AI regulation, “but the federal government should go first and define where the lanes are,” he said. Obernolte said states are “going wild,” with more than 2,000 AI bills introduced in statehouses last session, some very far ranging and impinging on federal prerogatives.
Brianne Miller, senior director of energy and infrastructure policy for Microsoft, said data center development has much shorter timelines for time to market than the timelines for getting the energy infrastructure approved and done. “That mismatch is hard,” she said.
Steve Haro, a lobbyist representing Southwest Power Group, said a shorter statute of limitations is needed for energy permitting lawsuits. Litigation is often “delay to destroy," aimed at tiring out the investor, he said.
Technology Industry Association CEO Dave Stehlin said telecom historically has used 1%-2% of electric grid capacity and so the expectation AI data centers will use north of 10% is “a major, major issue.” He said it points to the need for permitting changes and long-term planning. TIA is working on voluntary, data center-related quality standards for components like generators and cooling towers that hyperscalers can use in their request for proposals, Stehlin said.
Pointing to Incompas membership now including fusion, small nuclear reactor and power transmission and grid interests, Incompas head Chip Pickering said it reflects the association trying to build a full coalition of companies around AI.
Emily Domenech, the Federal Permitting Improvement Steering Council's executive director, said data centers, transmission lines and pipelines, and mining are particular priorities for the Trump administration and the council. The independent agency works to coordinate and accelerate federal permitting for projects over $200 million in 19 economic sectors. The council is dealing with a handful of broadband projects, as the council can take on smaller projects that are on tribal land, she said.
Domenech said the council wants to pursue a model for data centers where federal permitting for the center, its power and infrastructure are done concurrently instead of sequentially. She said it also is pursuing agreements with states where state permitting can opt into the Permitting Council process. As a result, state and federal permitting processes share data with one another and the state commits to all its permitting happening within the same time frame as federal permitting, she said. Domenech said the council signed a memorandum of understanding with Alaska in August and hopes to sign MOUs with others.
Incompas Notebook
Demand for cloud services and storage is driving the need for an additional megascale or hyperscale data center each week for the next several years, said Bartlett Cleland, NetChoice general counsel.
Fiber installation needs to be made earlier, such as by better explanation to state and local governments about what’s involved in big fiber projects, said Asim Raza, general counsel for digital infrastructure developer Arcadian Infracom. He said big fiber installations for data centers can act as an economic development boon, attracting other business investments to the area.