What Are AI Data Centers Doing To Your Electric Bill?

Electricity bills are on track to rise an average of 8 percent nationwide by 2030 according to a June analysis from Carnegie Mellon University and North Carolina State University. The culprits? Data centers and cryptocurrency mining. Bills could rise as much as 25 percent in places like Virginia. Science writer Dan Charles https://site.danielcharles.us/ explains why electric utilities are adding the cost of data center buildings to their customers’ bills while the data companies pay nothing upfront. Read the full June analysis here. https://energy.cmu.edu/_files/documents/electricity-grid-impacts-of-rising-demand-from-data-centers-and-cryptocurrency-mining-operations.pdf To listen to more on the environmental impact of data centers, check out our two-part reported series: - Why the true water footprint of AI is so elusive https://www.npr.org/2025/05/07/1249592906/energy-water-ai-climate-tech - How tech companies could shrink AI's climate footprint https://www.npr.org/2025/05/07/1249592906/energy-water-ai-climate-tech Interested in how technology affects everyday life? Email us your question at [email protected] mailto:[email protected]. Listen to every episode of Short Wave sponsor-free and support our work at NPR by signing up for Short Wave+ at plus.npr.org/shortwave http://plus.npr.org/shortwave. See pcm.adswizz.com https://pcm.adswizz.com for information about our collection and use of personal data for sponsorship and to manage your podcast sponsorship preferences. NPR Privacy Policy https://www.npr.org/about-npr/179878450/privacy-policy

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• 1:38Emily Kwong?

  Hi, Shortwavers. Emily Kwong here with NPR alum, now independent science writer, one of our favorite reporters on the planet, Dan Charles.

• 1:47Speaker 02

  Aw, you make me all choked up. Hi, Emily.

• 1:49Emily Kwong?

  Hey, Dan. Okay, you've brought us basically a mystery novel, something about money and power.

• 1:56Speaker 02

  Electric power. I took a field trip the other day, Emily, and I made you a little audio postcard.

• 2:03Speaker 02

  So here I am in data center alley, Northern Virginia, Loudoun County. And I'm standing along the road and there is not a person in sight, but I'm seeing these enormous buildings. And along the road, there are these enormous power lines, steel towers with wires hanging from them. There is so much electricity flowing into this place, like rivers and rivers of electricity.

• 2:27Emily Kwong?

  Yes, these are the buildings that are full of computing equipment and are seeing a rapid increase in construction to power AI. You've been poking around in them, huh?

• 2:37Speaker 02

  Well, what the specific thing I've been looking into is what is this doing to my electric bill?

• 2:42Emily Kwong?

  Yeah, that's a real concern. I was just reading, there's this analysis from Carnegie Mellon University and North Carolina State University found that electric bills are on track to rise an average of 8% nationwide by 2030, and as much as 25% in places like Virginia because of data centers and cryptocurrency mining.

• 3:00Speaker 02

  Now, some of those forecasts are a little speculative. They're based on models of future electricity markets. But I found a guy who showed me how this is actually playing out right now.

• 3:10Speaker 03

  I'm Mike Jacobs. I work at the Union of Concerned Scientists and transmission topics are what I do here.

• 3:17Speaker 02

  When he says transmission, he means electricity transmission. Power lines, substations full of massive pieces of equipment called transformers. This whole incredible network we call the electrical grid. He's a grid geek, so he sees things that go right by most people. Like when he takes a flight.

• 3:36Speaker 03

  I get a window seat so I can look for the transmission lines on the airplane. And now they lead to wind farms.

• 3:45Emily Kwong?

  So he's clearly dazzled by how the grid has changed.

• 3:48Speaker 02

  Yeah, this is his world. So a year or so ago, Mike was looking at plans for new power lines, and he saw a bunch of them were being built to supply data centers.

• 3:57Emily Kwong?

  Oh, wow.

• 3:58Speaker 02

  And he realized the data centers were getting these connections pretty much for free.

• 4:02Emily Kwong?

  What do you mean for free?

• 4:03Speaker 02

  Well, the data centers themselves don't have to pay extra to get connected. But you know, a famous economist once said, "There is no such thing as a free power line." So guess who's really paying the bill for this?

• 4:14Emily Kwong?

  My guess is it's people like us, Dan. People who pay our utility bill.

• 4:19Speaker 02

  Yeah. The electric companies are adding the cost of building these power lines into their customers' electric bills, which Mike thinks is outrageous.

• 4:28Speaker 03

  Dan, when I saw this and when I've showed it to my colleagues who work in the renewable field, and they see you don't have to pay for it if you're a data center, just gets your hackles up. It really was sort of a, this isn't right, kind of moment for me.

• 4:44Emily Kwong?

  Today on the show, what's coming to light about how utility customers like you and I are footing the bill to bring data centers online?

• 4:52Speaker 02

  And why a lot of people want that to change.

• 4:54Emily Kwong?

  I'm Emily Kwong.

• 4:56Speaker 02

  And I'm Dan Charles. And you're listening to Short Wave, the science podcast from NPR.

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• 6:33Emily Kwong?

  OK, Dan, let's back up a little bit with Mike here. When did he start investigating data centers?

• 6:39Speaker 02

  Well, Mike's starting point was, we need more clean energy, more solar and wind. You know, instead of burning coal and gas, which pollutes the air and warms the planet.

• 6:49Speaker 03

  In the future, we're going to have our economies run on non-fossil fuel. And we're going to think it was so foolish to dig up ancient carbon and burn it.

• 7:01Speaker 02

  But the thing is, solar and wind farms have to send that clean electricity to where people need it.

• 7:07Emily Kwong?

  Right, so we can charge our electric cars, cook our food, and it's power lines that's ultimately carrying that energy where it needs to go.

• 7:14Speaker 02

  Yeah, and as a grid geek, Mike spends a lot of time looking at obscure documents on the websites of electric utilities. These are the companies that build and maintain that network of power lines and send us an electric bill every month.

• 7:28Speaker 03

  I was digging around these local plans. And I started to notice these references about building for data centers.

• 7:39Speaker 02

  So, for instance, he was going through this document from Dominion Energy, which serves most of Virginia. It lists the projects they have in the works.

• 7:48Speaker 03

  Page 36, a new delivery point to serve a data center customer in South Hill, Virginia. Page 48, a request at the White Oak substation to serve a data center customer.

• 7:57Speaker 02

  Page 50.

• 7:58Speaker 03

  Page 58. Serve a data center complex.

• 8:00Speaker 02

  Data center complex.

• 8:01Speaker 03

  A data center customer.

• 8:03Emily Kwong?

  I'm picturing him like with his mind map, data center, data center. How many data centers, as far as he could tell, is Dominion planning to power?

• 8:13Speaker 02

  So in this one document from 2024, a couple of dozen projects just in Virginia, he went to similar documents from six more states in this same part of the regional electrical grid, Pennsylvania, Ohio, Illinois, New Jersey, Maryland, and West Virginia, and he found 130 projects for data centers costing in total over $4 billion.

• 8:37Emily Kwong?

  $4 billion, wow, that is a lot. So a fleet of data centers is under construction, fueled by the ambitions of tech companies like OpenAI and of course, the Trump administration's support for AI. So Dan, can you describe what one of these data center construction projects looks like?

• 8:54Speaker 02

  Yeah, so I picked one of the places in that list of projects that Mike saw, and I drove out to Fairfax, Virginia to look at it. I found an old warehouse, a parking lot, a big U-Haul center. It all felt kind of sleepy, honestly. But in a few years, a data center and a substation are supposed to fill this space, about the size of eight football fields.

• 9:16Emily Kwong?

  Wow.

• 9:17Speaker 02

  And I'd arranged to meet a couple of people from Dominion Energy here, Ayesha Khan and Rob Richardson. Have you come out here a lot?

• 9:22Speaker 06

  Not for, not for a while.

• 9:25Speaker 02

  How about you?

• 9:26Speaker 07

  No, I mean, we've got a bunch of transmission projects we're working on.

• 9:30Speaker 02

  Rob set up a little tablet computer on the hood of his truck to show me the plan.

• 9:34Speaker 06

  We're right here, right here by the, by the U-Haul. The Edsel substation would be here at this.

• 9:42Speaker 02

  Right where we're standing or down there for the?

• 9:44Speaker 06

  Nope, right about here.

• 9:45Speaker 02

  Yep.

• 9:46Speaker 06

  And then the transmission lines, you know, would come in right here by this creek.

• 9:51Speaker 02

  It's going to be a big power line, big enough to power a small city. Steel poles, 120 feet tall. Together with the substation, this project is listed as costing $40 million.

• 10:03Emily Kwong?

  Dan, is this power line just for one data center?

• 10:07Speaker 02

  Yeah, so this is an interesting point. I got slightly different answers from Ayesha and Rob about that.

• 10:14Speaker 07

  It's to meet the growing demand here. It's for reliability. It's not just the data centers, it's, you know, our hospitals, your schools, your churches, you know, residents.

• 10:23Speaker 02

  But the data center did ask for this, right?

• 10:26Speaker 06

  Then I think the data center is largely driving the need for this project. Yes.

• 10:34Speaker 02

  So honestly, there's really no question it is getting built because the data center needs it.

• 10:39Emily Kwong?

  Okay.

• 10:40Speaker 02

  But Dominion argues that new power lines like this also make the whole power grid stronger and more reliable. So everybody benefits and that's why it makes sense for everybody to pay for it.

• 10:52Emily Kwong?

  How exactly does Dominion get itself into a position where it can charge customers for this?

• 10:58Speaker 02

  So electric utilities like Dominion Energy aren't like regular businesses. They are regulated monopolies.

• 11:04Emily Kwong?

  Right. When I covered local government, I saw this up close, like the local government regulators, they set the rates that companies like Dominion are allowed to charge.

• 11:15Speaker 02

  That's right. Dominion Energy sells electricity, maintains the grid, builds power lines when they're needed. And regulators let them charge consumers just enough to cover those costs and collect some profit on top.

• 11:28Emily Kwong?

  Okay.

• 11:29Speaker 02

  So when Dominion spends more money building new power lines for data centers, that extra cost translates directly into a little boost in the rates that everybody pays.

• 11:39Emily Kwong?

  Hmm, because the system is kind of set up this way. So how much are data centers adding to people's electric bills right now?

• 11:46Speaker 02

  So this is surprisingly hard to figure out. This wave of new data centers is just starting, for one thing. It's not exactly clear what the costs will be. You have some people saying electric bills could jump a lot, like $70 a month. And others say there could even be cases where data centers actually reduce people's bills if utilities can spread all their fixed costs across this growing base of customers. But based on what's happening in, for instance, Ohio and Pennsylvania, where utilities have proposed big increases in electricity rates, it seems like data centers there at least will likely cost an average household at least a few extra dollars every month.

• 12:27Emily Kwong?

  Ultimate question, is this fair?

• 12:30Speaker 02

  Well, Mike Jacobs sure doesn't think so.

• 12:32Speaker 03

  This is not fair. You know, this isn't right. All the consumers of Virginia are subsidizing the business plans of these data center companies, which I would say is morally wrong and bad policy.

• 12:44Emily Kwong?

  Interesting. What does he think would make this fair?

• 12:48Speaker 02

  Basically, Mike would like electric utilities to handle power lines for data centers the way they already handle power lines for solar and wind farms. So here's an example. Right now, there's a company that wants to build a big solar farm called Cassius Blue in southern Virginia. That's named for a really pretty butterfly species, by the way.

• 13:07Emily Kwong?

  Nice, OK.

• 13:08Speaker 02

  So in order for Cassius Blue, the solar farm, to connect to the electrical grid, it'll need Dominion Energy to build or upgrade some power lines. And Dominion Energy has said, OK, we'll build them if you pay us $27 million.

• 13:23Emily Kwong?

  Huh, OK. So it sounds like if you are a solar or wind farm generating electricity, you have to pay for the power lines. But if you are consuming electricity, like you're a customer, a big data center, you don't have to pay for that upgrade. Instead, everybody gets a rate increase tacked on to their bill to build those power lines.

• 13:42Speaker 02

  That is the way the system works right now. Those are the rules. And Mike says the rules should change, that data centers should have to pay upfront for the power lines they need, just like solar farms.

• 13:53Emily Kwong?

  What are the chances, Dan, that this will actually happen?

• 13:56Speaker 02

  Yeah, it actually is possible, I think. Data centers are not popular these days. They're running into more and more opposition. And just a few weeks ago, the Trump administration actually called for a new federal rule that would require new data centers to pay the costs involved in connecting them to the grid.

• 14:14Emily Kwong?

  Oh, wow. That's a big shift.

• 14:15Speaker 02

  Yeah, it was kind of a shock because the Trump administration's been very enthusiastic about AI. Mike Jacobs says it's not really clear if there will be any such rule because this has always been something that state regulators had control over, not the federal government.

• 14:30Speaker 03

  But they're asking for the right thing. So we got a nice little fight unfolding over this very problem.

• 14:38Speaker 02

  So all I can say is, Emily, stay tuned.

• 14:44Emily Kwong?

  Dan Charles, thank you so much for coming on to share what's going on with data centers and people's electric bills.

• 14:50Speaker 02

  Thanks for having me on the show.

• 14:51Emily Kwong?

  And short wavers, if you want to dig into the environmental impact of data centers, we have a two-part series for you that I reported earlier this year. Visit our show notes to listen to it. This episode was produced by Burley McCoy. It was edited by Rebecca Ramirez. Tyler Jones checked the facts. Jimmy Keeley was the audio engineer. Beth Donovan is our senior vice president of podcasting. I'm Emily Kwong. Thanks for listening to Short Wave, the science podcast from NPR.

• 15:23Speaker 04

  Stay tuned for the following announcements and messages from our sponsors.