Securing the Grid: Microgrids, Critical Minerals, and the Case for a Dual-Track U.S. Energy Strategy

Demand for electricity is expected to increase exponentially over the coming decades, driven primarily by the rapid scaling of data centers and AI infrastructure. Despite recent growth in nameplate capacity, effective generation capacity has remained largely flat, reflecting years of underinvestment and a regulatory environment ill-equipped to meet the pace of modern demand. Strategic sites including military bases, airports, and data centers remain reliant on a civilian grid already pushed to its limits, presenting a single-point-of-failure vulnerability with direct implications for national security and economic competitiveness. President Trump’s declaration of a National Energy Emergency formally recognized this reality.

The same infrastructure required to address domestic energy vulnerabilities including microgrids, energy storage, and small modular reactors depends on critical mineral supply chains almost entirely controlled by China. Through decades of strategic investment, China has secured vertical dominance across the critical minerals ecosystem, controlling 87% of rare earth processing and maintaining leverage over the inputs essential to data centers, power plants, and defense systems alike. As Under Secretary of State Jacob Helberg observed, “if the 20th century ran on oil and steel, the 21st century runs on compute and the minerals that feed it.”

This memorandum proposes two mutually reinforcing initiatives: a domestic program to secure strategic sites through microgrids anchored by small modular nuclear reactors (SMRs), and an international effort to build on the momentum of Pax Silica and challenge China’s mineral dominance through a coalition of likeminded states. Together, they address the supply and the security of the infrastructure upon which American power increasingly depends.