Smith pledged that Microsoft will "pay our way" to prevent its data centers from raising electricity prices, as part of a larger five-point "community first" AI infrastructure plan.
"The truth is infrastructure buildouts progress only when communities conclude that the benefits outweigh the cost, and we are at a moment in time when people have a lot of their mind," Smith said Tuesday.
"They're worried about the price of electricity," he continued. "They wonder what this big data center will mean to their water supply. They look at this technology and ask, what will it mean for the jobs of the future? What will it mean for the adults working today? What will it mean for their children?"
Major tech companies have been rapidly expanding their data center infrastructure in recent years amid the race to develop AI. However, this has increasingly been accompanied by concerns that the extensive energy demands of these data centers are raising consumer electricity prices.
As part of its effort to keep prices down, Microsoft vowed to pay utility rates that are "high enough" to cover its electricity costs and work with utility companies to add necessary electricity supply.
"The truth is, demand for electricity is growing," Smith said. "Infrastructure and data centers are a part of that growth and demand. They are far from the majority of that cost, but they do matter, especially in a local community where a data center is being built or expanded."
The tech giant also aims to reduce its water usage and replenish more water to local communities than it uses, as it seeks to address another major environmental concern related to data centers.
It vowed to invest in training for local construction jobs and operational roles at data centers, as well as AI education, and said it would not ask communities to reduce local property tax rates to attract its data centers.
Smith also pledged greater transparency, acknowledging frustrations with tech companies' use of non-disclosure agreements for data centers.
The move from Microsoft earned praise from President Trump, who noted late Monday that his administration has been working with major tech companies to secure commitments on the issue.
"First up is Microsoft, who my team has been working with, and which will make major changes beginning this week to ensure that Americans don't 'pick up the tab' for their POWER consumption, in the form of paying higher Utility bills," Trump wrote on Truth Social.
"We are the 'HOTTEST' Country in the World, and Number One in AI," he added. "Data Centers are key to that boom, and keeping Americans FREE and SECURE but, the big Technology Companies who build them must 'pay their own way.'"
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