AI Data Centers Could Raise U.S. Electric Bills

Power-hungry data centers are multiplying and growing larger as companies support generative AI, cloud services and stored information. These facilities run thousands of servers and networking equipment, while also using electricity for cooling. A Schneider Electric projection puts nationwide power-demand growth at 16% by 2029, driven chiefly by data-center expansion.

The scale is already significant. Data centers consumed about 4.4% of U.S. electricity in 2023, according to a Lawrence Berkeley National Laboratory study. Their U.S. count almost doubled from 2021 through 2024. Torsten Sløk of Apollo Global Management estimates they will need 18 additional gigawatts of capacity by 2030—three times New York City’s roughly 6-gigawatt demand. AI queries also require 10 times the electricity used by standard internet searches, an Electric Power Research Institute study found.

For Simi Valley residents, California is among the three states with the largest concentrations of these facilities, alongside Virginia and Texas. Utilities can incorporate anticipated demand and new infrastructure expenses into rates. New Jersey customers were warned of increases reaching 20% beginning June 1. In Virginia, Dominion Energy proposed adding $8.51 monthly in 2026 and raised the possibility of a separate category for heavy users such as data centers.

Prices are also affected by natural gas costs, inflation and the electrification of vehicles and buildings. Reliability is another concern: AI and cryptocurrency facilities are developing faster than the generating plants and transmission infrastructure needed to serve them. PJM identified data-center demand as one possible contributor to capacity shortfalls in its 2025 outlook.