Read more at Associated Press

• Rising Bills and Pressure on States: As electric bills increase, states are facing pressure to protect household and business ratepayers from the high energy costs associated with data centers.
• Massive Energy Consumption: Data centers, especially those for AI, can consume more electricity than large cities like Pittsburgh or New Orleans, dwarfing the needs of typical industrial customers. This is forcing policymakers to re-evaluate how electricity and transmission costs are allocated.
• The Cost of New Infrastructure: The surge in data center demand is driving the need for a rapid build-out of power plants and transmission lines, a cost that is often being spread across all electricity customers. A Harvard study suggests this system “breaks down” when billions of dollars in infrastructure are built for a few wealthy companies.
• Evidence of Cost Shifting: A report from Monitoring Analytics, an independent market watchdog, found that 70% ($9.3 billion) of last year’s increased electricity costs in the mid-Atlantic grid were due to data center demand. Another report suggested that specialized rates for data centers in 16 states are not sufficient to cover the cost of new power plants, implying that other ratepayers are subsidizing the tech companies.
• States Are Taking Action: In response, over a dozen states are taking steps, including pressuring grid operators to prevent price increases, studying the effect of data centers on bills, and pushing for data center owners to pay a larger share of transmission costs.
• Doubts and Concerns: Despite these efforts, some critics question whether states and utilities have the political will to take a hard line against major tech companies like Amazon, Google, and Microsoft. They argue that utilities and regulators have an incentive to attract data centers and may offer special deals, with the costs secretly passed on to regular customers.