The current international system is undergoing a profound realignment, driven by shifting geopolitical alliances, economic tensions, and evolving security challenges. This changing landscape has resulted in significant questions concerning the future trajectory of US global leadership and engagement, especially following President Donald Trump’s initial foreign policy actions during his second term. Actions in areas such as trade, support for Ukraine, and approaches to foreign assistance have raised doubts among allies regarding the consistency of US commitment on the global stage.
As the world faces a new age of uncertainty, global energy security has emerged as a critical focus—exacerbated since the full-scale Russian invasion of Ukraine. The Trump administration’s commitment to an “energy dominance” agenda, particularly its focus on enhancing US oil and gas production and exports, is vital. Equally crucial, however, are the geopolitical dynamics within the electricity sector, which is gaining relevance in global affairs.
Electricity demand has been surging at a rate of about 4 percent per year and has risen to a pivotal role at the heart of contemporary geopolitics. As a consequence, the decisions made under the Trump administration will have extensive implications for international conflict, competition, and cooperation.
One of the dominant geopolitical factors affecting the electricity landscape is the aggressive military posture of Russia towards Ukraine. This aggression has intensified the confrontation between Western nations and a coalition of authoritarian states—namely China, Iran, and North Korea—that have supported Russia’s war efforts in various forms. This conflict has underlined the importance of electricity security, a view echoed by the executive director of the International Energy Agency (IEA) during discussions with EU leaders. The European Union (EU), aided significantly by increases in US liquefied natural gas (LNG) exports, has successfully diminished its reliance on Russian gas for electricity, ramping up renewable energy to account for 47 percent of total generation. Additionally, efforts to replace Russian nuclear fuel sources with those from the West, alongside the disconnection of the Baltic states from the Russian power grid, reveal substantial shifts in energy policy.
Globally, outside of the EU, 2024 witnessed record levels of electricity demand growth, especially in Asia, with China contributing to approximately half of this increase. While the International Monetary Fund (IMF) predicts a slowdown in global economic growth due to continuing uncertainties and the impact of Trump’s tariff strategy, the IEA still anticipates considerable electricity demand growth over the next few years.
This anticipated rise in demand is being propelled by the explosion of digital information and the advanced artificial intelligence (AI) systems that analyze this data. The revolution in the electricity sector driven by these technologies has increased the necessity for reliable, secure, flexible, and resilient electricity supplies for numerous applications, including data centers vital to both civilian and military operations. As countries expand more complex and interconnected national and regional electricity grids, the risk of cyberattacks—particularly from state actors such as China—has surged. Maintaining electricity security has thus become an integral aspect of national security in this new era.
The burgeoning demand for electricity has initiated a competitive race to innovate and implement new energy technologies. A particularly important area is the development of advanced nuclear power systems. Various designs are underway to meet an array of requirements including electricity generation, industrial heat, desalination, military systems, and hydrogen production. Interest in nuclear power has experienced a notable resurgence globally, with leading countries at COP28 committing to triple nuclear power capacity by 2050 compared to 2020 levels.
Amidst these developments, the expanded use of tariffs by the Trump administration has introduced additional complexities to global economic competition. This strategy is affecting relationships among allies and adversaries alike, while also straining electricity supply chains that involve crucial components such as power transformers, switchgear, and meters. Such pressure presents an opportunity for China, the largest exporter of electric power equipment and electronics, to expand its influence particularly in emerging markets and developing economies (EMDEs). EMDEs, which account for two-thirds of global electricity production, are projected to drive 85 percent of global electricity growth over the next three years.
Over the last decade, as the costs of solar and wind energy have significantly decreased, EMDEs have been transitioning toward renewable energy sources. While renewables constituted only 26 percent of EMDE generation in 2023, they accounted for over 75 percent of the new generation capacity installed outside of China. The Chinese dominance in the renewable sector provides the country with significant geopolitical leverage, as evidenced by a 30 percent increase in global installed solar photovoltaic (PV) capacity in 2024, boosting the potential market share of Chinese firms in this sector.
Natural gas demand in EMDEs is also on the rise, driven by its capability to complement intermittent renewable energy sources and improve grid reliability. This scenario opens up opportunities for a growing role of the United States in EMDE electricity markets. As the nation’s largest LNG exporter, the United States aims to expand its export capacity and access to markets in India, Southeast Asia, and other EMDEs. Some countries might pledge to increase imports of US LNG during their trade discussions with the Trump administration, aiming to address trade imbalances and reduce tariff barriers. By 2024, US LNG exports reached 20 EMDEs, constituting approximately 30 percent of total US LNG export volumes.
In recent years, the United States has made significant strides in the development of advanced nuclear power systems, with several projects beginning construction. This advancement places the United States in a favorable position to compete for new nuclear contracts across EMDEs, particularly with smaller reactors that cater to the specific needs of countries with smaller grids. The focus on small modular reactors (SMRs) offers benefits such as lower total capital costs and quicker construction timelines compared to larger reactors. While Russia has maintained a dominant role in the international new-build market through Rosatom’s large reactor projects, and China continues to expand its reactor construction efforts, the US aims to establish a significant presence as it seeks to win contracts in a variety of regions.
Recognizing the strategic importance of nuclear energy, the Trump administration, alongside bipartisan support, has prioritized the development and demonstration of advanced reactor technologies, as well as domestic uranium mining, enrichment, and fuel production. Recent executive actions by President Trump to escalate US nuclear capacity from 100 to 400 gigawatts by 2050 further elucidate this strategy. This growth would not only bolster domestic needs but also enhance prospects for exporting nuclear technology to both developed and EMDE nations.
Moreover, US companies are looking into opportunities for collaboration across a range of nations—including advanced economies such as the UK, Canada, and Poland, as well as EMDEs like Ukraine, India, and Vietnam—illustrating growing global interest in SMRs. A substantial portion of the IEA’s projected global market for SMRs stands to be captured by the United States by 2050, thereby solidifying its competitive standing in this arena.
In light of its established superiority and innovation in the electricity sector, the United States is well positioned to participate in global dialogues focused on adopting advanced technologies that enhance grid reliability, flexibility, and resilience. Engagement in overseas markets—valued at over $2 trillion annually—is critical for US commercial interests as well as its national security. Restoring trust and confidence in the United States as a reliable partner is essential in this context.
To achieve this, the United States should capitalize on its strengths as the leading producer of natural gas and nuclear power in helping other nations develop dependable energy sources. By promoting comprehensive investments in renewables, energy efficiency, hydrogen technologies, and carbon capture, the US stands to bolster its influence worldwide.
As the Trump administration recalibrates its foreign policy approaches, an innovative partnership between government and industry is vital for enhancing US energy leadership. This collaboration would require the coordinated deployment of essential diplomatic and economic tools, including technology and commerce agreements, regulatory support, capital allocation, and investments that align with the unique energy needs of individual nations.
Bilateral efforts will be crucial, but successful US leadership will necessitate close cooperation with allies to promote sound multilateral financial and technological collaborations, foster Western-oriented regional electricity markets, and secure reliable supply chains.
The age of electricity is approaching rapidly. The question remains: will the United States rise to the occasion and recognize that being a global leader in this transformative sector is critical to its national security?
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