In an era where artificial intelligence promises to revolutionize everything from healthcare to entertainment, one inconvenient truth is emerging: The massive data centers powering this tech boom are driving up electricity costs for Americans.
From skyrocketing capacity prices in regional grids like PJM, which serves 67 million people across 13 states, and MISO, serving 46 million across 15 states, to hidden subsidies baked into utility bills, ratepayers are footing the bill for Big Tech’s energy guzzle.
It’s time to demand that these mega-corporations pay their way without socializing the costs on consumers’ backs. Many will never touch AI.Some may lose their jobs while paying more for their electricity due to the rapid expansion of AI data centers.
Consider the facts: Data centers consume about 4 percent of U.S. electricity, projected to triple to 12 percent by 2028. In Illinois, they account for 5 percent of statewide usage, contributing to higher bills as utilities build infrastructure to meet demand. The Electric Power Research Institute estimates data centers could devour up to 9 percent of national electricity generation by 2030, straining grids and forcing costly upgrades.
In PJM, capacity prices surged nearly 10-fold in 2024 auctions, mainly due to data center-driven demand spikes and the addition of part-time weather-dependent wind and solar power.
Similarly, MISO’s 2025 and 2026 prices jumped 2,100 percent, with data centers adding gigawatts of load that outpace retiring plants.
This isn’t just market mechanics — it’s a subsidy scheme. Utilities often shift the costs of grid expansions, power plants and transmission lines to all ratepayers, even as tech giants like Microsoft and Google negotiate sweetheart deals or tax breaks. In Georgia, for instance, data centers have prompted billions in infrastructure spending, with ratepayers eating the costs while companies reap the benefits.
A Microsoft data center in Mount Pleasant, Wis., exemplifies the strain Big Tech places on local grids. Set to consume 450 megawatts by 2026, enough to power 300,000 homes, it’s poised to be Wisconsin’s largest electricity user, driving the need for a $300 million grid upgrade and a new 752 MW substation.
While Microsoft pledges to “pay its own way,” “We Energies’” proposed gas plants to meet the increasing demand, which will raise rates unless Microsoft fully funds it, burdening ratepayers who don’t use AI. This massive facility underscores why data centers must fully fund their infrastructure, sparing Wisconsin families from subsidizing corporate profits.
A Harvard Electricity Law Initiative paper reveals how utilities force residential customers to fund discounted rates for data centers, effectively extracting profits from the public. As one analysis warns, this could lead to “staggering” bills for consumers, with upgrades socialized across households that don’t benefit from the AI hype.
Why is this unfair? Many Americans — seniors, low-income families, rural residents — don’t and won’t use AI. They stream Netflix or check email, not query chatbots or train neural networks, yet they’re subsidizing the energy appetites of trillion-dollar corporations. Data centers can consume as much power as cities, all the time, spiking regional prices, for which everyone pays.
In Kentucky, rural communities are seeing monthly surcharges from AI data centers, hitting small towns the hardest. This inequity is exacerbated by the fact that Big Tech reaps immense profits from AI, while everyday people face inflation-busting electric bills — up $9.3 billion last year, with 70 percent tied to data center demand in some regions.
Policymakers must act. California and New Jersey are leading with bills requiring data centers to cover their infrastructure costs. Every state should do this. These corporations can afford it, and it isn’t fair to regular people.
Utilities and regulators should implement special tariffs for large loads, ensuring tech firms pay upfront for grid upgrades without shifting burdens. And other electric users don’t pay through the nose downstream.
Unless lawmakers in multiple states intervene with laws and regulations to protect this cost shift, residents’ power bills will keep climbing.
Big Tech can afford it — their valuations soar on AI promises. Let them invest in dedicated power sources or efficiency tech, setting a precedent for equitable growth. At the same time, our lawmakers and regulators should protect regular electricity users by stopping this massive cost shift.
In addition, other industries like manufacturing, foundries and grocery stores will have higher electricity prices that will make them uncompetitive internationally and cause inflation in the general economy.
Because energy costs are baked into everything we eat, buy, or do, we shouldn’t all pay for the mega-corporation’s tech gold rush.
Demand accountability: Data centers must pay their own way, or the grid — and our wallets — will buckle under their weight.
