Wholesale electricity costs as much as 267 per cent more than they did five years ago in areas near data centres, with costs being passed on to customers across the United States.
A Bloomberg News analysis of wholesale electricity prices for tens of thousands of locations across the country reveals the effects of the AI boom on the power market, reports Bloomberg. About two-thirds of the power consumed in the US runs off of a state or regional grid, where wholesale commodity costs are passed on to households and businesses on utility bills.
Of the nodes that recorded price increases, more than 70 per cent are located within 50 miles of significant data centre activity. Kevin Stanley, a 57-year-old Baltimore resident who survives on disability payments, says his energy bills are about 80 per cent higher than they were about three years ago.
Baltimore residents saw their average bill jump by more than $17 a month after a power auction held by PJM Interconnection reached a record high, according to Exelon’s Baltimore Gas & Electric utility. This year’s auction set another record, which will boost the average power bill in Baltimore again by up to $4 starting in mid-2026.
The rapid development of data centres relying on the PJM system raised costs for consumers from Illinois to Washington, DC, by more than $9.3 billion for the 12 months starting in June, according to the grid’s independent market monitor.
“The reliability crisis is here now; it’s not off in the distance somewhere,” said Mark Christie, a former chairman of the Federal Energy Regulatory Commission who also served as a long-time Virginia regulator.
In the US, power demand from data centres is set to double by 2035, to almost 9 per cent of all demand, according to BloombergNEF. Globally, data centres are expected to consume more than 4 per cent of electricity by 2035.
“Without mitigation, the data centres sucking up all the load is going to make things really expensive for the rest of Americans,” said David Crane, chief executive officer of Generate Capital and a former energy official in the Biden administration.
