Data Center Growth Could Increase Electricity Bills 8% Nationally and as Much as 25% in Some Regional Markets

By: state and federal policy strategies to consider that may mitigate the effects of this expected growth, such as:

• Fair cost allocation: Create new customer classes and revenue sharing mechanisms to ensure large users rather than families pay for elevated infrastructure costs.
• Strategic siting incentives: Incentivize data center expansions in renewable-rich regions and away from areas dependent on fossil fuel generation.
• Transmission acceleration: Improving permitting and cost allocation for transmission lines connecting renewable resources to demand centers.
• Demand flexibility requirements: Incentivize or require energy efficiency or load management during peak periods or emergencies.

What's next: Data center and crypto mining electricity demand is projected to grow 350% by 2030. Without intervention, the pattern seen in PJM — massive price spikes followed by political backlash — will become more frequent. Continued investment in energy systems modeling resources like those maintained by the Open Energy Outlook Initiative can help identify policy interventions that balance the benefits and costs of increased data server activity. 

The bottom line: The digital infrastructure boom is outpacing our electricity system’s ability to respond. Data centers offer potential benefits but risk locking in higher emissions and driving up prices for households without proactive and coordinated planning. Policymakers must act now to align infrastructure investment and regulation with this demand surge.