Power, Policy &AI: The Rules of the Race in 2026

Key takeaways: In 2026, the global AI race will accelerate, driven by powerful public-private partnerships. Governments are moving from caution to commitment, fast-tracking AI adoption to revolutionize public services, national security, and healthcare. This collaboration between government and industry is key to navigating challenges like energy demands, workforce upskilling, and establishing clear regulations. As nations pursue AI sovereignty, these alliances will define leadership, scaling secure solutions and embedding resilience into our digital and physical infrastructure. The focus is on unified action to ensure AI drives progress for everyone.

In recent years, governments and policymakers worldwide have been working to understand and respond to the rapid evolution of artificial intelligence. As we move into 2026, several realities are emerging, shaping not only U.S. federal and state-level strategies but also global approaches to AI governance. 

1. 1. 1. Governments will fast-track AI adoption to revolutionize public services. After a year of cautious exploration, 2026 will mark a turning point. States and countries across the globe are moving from curiosity to commitment as professionals work to adopt AI and integrate it into operations by revamping procurement rules, modernizing legacy systems and investing in workforce upskilling. Expect a surge in public-private partnerships as governments race to embed AI into their operations and deliver smarter, more responsive services.
      2. AI’s regulatory integration within existing frameworks will advance, but global harmony remains elusive. In 2026, policymakers will focus on pragmatism, leaning on existing laws to guide AI oversight. We will see more instances of enforcement agencies leveraging pre-existing regulatory frameworks to address consumer protection and privacy concerns relating to AI in areas like finance, healthcare and energy. But as the speed of AI advancement and applications continues to outpace regulatory development, renewed calls for stricter regulation will inevitably clash with the reality of a rapidly evolving technological landscape. Conflicting efforts at state and federal levels to regulate AI will lead to inharmonious standards across jurisdictions, making compliance more challenging and once again threatening to chill innovation. These tensions will require government entities at all levels to partner with the private sector to help shape the evolving regulatory framework and standards.
      3. Countries around the world will make AI sovereignty a national imperative. Countries will double down on homegrown AI strategies: keeping data local, nurturing domestic innovation and reducing reliance on foreign tech. Yet, this push may widen the gap between tech-rich nations and those still building capacity. Whether truly independent or negotiated, next year we will see many nations seeking some form of AI sovereignty. Expect 2026 to bring new alliances as emerging economies seek secure partnerships to build infrastructure and host data, reshaping geopolitical dynamics in the process.
      4. Public-private alliances will redefine the global AI race. Governments and industry are no longer adversaries on AI policy; they’re allies. After years of tension over governments’ distrust of the tech industry’s ability to make good on commitments to “responsible AI” and industry railing against threats of over-and mis-regulation of emerging technology, 2025 saw a thaw. 2026 will bring deeper collaboration in a way not seen for decades (if ever before). With governments offering regulatory support and industry delivering innovation, the two will work in lockstep to deploy AI infrastructure and export national capabilities. The goal: global tech leadership through strategic alignment of public and private interests.
      5. Without policy intervention, energy bottlenecks will hinder AI’s growth trajectory. Data centers are hungry for power, but grids are strained. In 2025, governments acknowledged that physical constraints of compute power limited the full potential of AI. In 2026, governments will tackle infrastructure chokepoints, such as transformers, transmissions, substations, and cooling systems, while incentivizing energy-efficient AI models and edge computing. New and unexpected partnerships will emerge across geographies and industries as the conversation evolves from energy scarcity to energy-smart innovation. Nations with abundant, accessible energy will gain a strategic edge in the AI race.
      6. Workforce policy will pivot from future-proofing to present-tense urgency. Governments will shift their focus from long-term STEM education to immediate upskilling of today’s workforce. With displacement fears rising, expect policies that push companies to retrain employees and share knowledge across sectors. 2026 will be the year of the AI-ready workforce, by necessity, not choice.
      7. AI will reshape healthcare and reignite policy debates. From diagnostics to personalized care, governments will deploy AI to expand access and improve outcomes. But as real-world applications accelerate, so will scrutiny. 2026 will see renewed debates on data privacy, ethical use and safety as policymakers move from theoretical discussions to practical governance of AI in medicine.
      8. AI will become a cornerstone of national security. Defense, cybersecurity and disaster response will increasingly depend on AI to anticipate threats, accelerate decision-making and safeguard critical infrastructure. Governments will develop governance frameworks to help ensure AI is deployed securely, ethically and in alignment with mission-critical objectives. This convergence will shape AI security priorities, reinforcing the need for strategies that strengthen a future-ready defense posture.
      9. Agentic AI Will Challenge Policy Norms. As autonomous AI agents take on complex and more sensitive tasks across sectors, policymakers will face urgent questions around accountability, transparency and human oversight, requiring consideration of forward-looking interworking frameworks that guide their safe integration. We will see these discussions burgeion in 2026, though resolution will be a long way off, even as technology swiftly continues to develop, and the path to adoption becomes clearer.

The Bottom Line

With AI’s trajectory accelerating, one thing is clear, coming through in 2026: policymakers and the public sector are stepping deeper into the AI race. Public-private partnerships will become a force multiplier, speeding innovation, scaling secure solutions and embedding resilience into national digital and physical infrastructure.