Electricity cost concerns grow amid push for more AI data centers
The Trump administration recently released an ' AI Action Plan,' which vowed to expedite permitting for the construction of energy-intensive data centers. During the unveiling of the plan, President Trump acknowledged the growing need for power to run these centers, which are being built across the country by companies like Google, Amazon and Microsoft.
New reporting by the Washington Post suggests consumers are seeing a spike in their energy bills because of these data centers. According to the report, customers in the areas serviced by PJM Interconnection have seen their electricity bills increase. In Ohio, prices are up between 10 percent and 15 percent, while in New Jersey, prices have increased 20 percent.
Experts have told NewsNation that a 5-gigawatt data center could use more energy a year than many states — but they insist Big Tech growth isn't solely to blame for the recent price increases.
'Data centers are affecting electricity, but they are affecting electricity planning at this point. They are not necessarily affecting electricity bills,' said Tricia Pridemore, president of the National Association of Regulatory Commissioners (NARC). 'These large AI data centers that you keep hearing about on the news, they are in the planning and construction phase at this point.'
Supply and demand are believed to be behind cost increases in the PJM territory, which has a reorganized market. They have a capacity auction in which power industries bid to supply enough electricity in the future. Right now, there is a greater demand because more supply will be needed for these data centers.
At PJM's recent auction, prices went up a record 22 percent, according to Reuters.
'Within reorganized markets such as PJM, MISO, SPP, they go out and use independent power producers to generate electricity,' Pridemore said. 'Based upon the electricity that is available, those market prices drive the cost of the electricity to anyone in the system, whether it's a residential customer or a commercial or a business customer.'
The NARC president added that data centers can reduce their power usage and cost by using renewable energy, and some are already tapping into solar energy.
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