While data centers bring jobs and tax breaks to states, residents are seeing higher electricity costs|US Department of Energy
Residential electricity bills have jumped across several US states this summer due to unprecedented demand from AI data centers in the region, according to data.
How?
PJM Interconnection, which supplies power to 67 million people across 13 states, reported an 833% surge in wholesale electricity prices in the 2024 auction. The bid usually determines the cost of electricity for the following year.
Nearly 75% of the sudden surge was linked to demand from existing and planned data centers.
PJM also saw a 22% spike in wholesale electricity prices in this year’s auction. That could mean up to a 5% hike in monthly bills in 2026.
Growing demand
After a decade of stagnation, electricity demand in the US is expected to grow 2.5% annually through 2035, mostly due to data centers. Tech giants like Amazon, Meta, Microsoft and Google are fueling this surge.
Impact on communities
While data centers bring jobs and tax breaks to states like Virginia and Ohio, residents are experiencing higher electricity costs, noise pollution and environmental impacts.
With utility costs already outpacing inflation, consumer advocates are sounding alarms about an “energy affordability crisis” in the US.