WASHINGTON — Rapid expansion of electricity-hungry data centers is expected to add billions of dollars in power costs across parts of the United States, intensifying concerns among utilities, regulators and policymakers over who should bear the expense of building the infrastructure needed to support artificial intelligence-driven demand.
The issue has gained urgency as utilities forecast sharply higher electricity consumption from large-scale data centers, while grid operators warn that new generating capacity and transmission infrastructure may not be built quickly enough to keep pace. Analysts say the resulting costs could increasingly be passed on to consumers unless regulators adopt measures requiring large electricity users to shoulder a greater share of new investments.
A recent analysis of the PJM Interconnection power market, which serves all or parts of 13 U.S. states and the District of Columbia, found that growing demand from data centers is expected to contribute about $6.3 billion in additional electricity charges through capacity market auctions designed to ensure sufficient future power supplies. The costs would ultimately be reflected in electricity bills paid by households and businesses across the region unless offset by regulatory action or alternative cost-allocation mechanisms.
The White House has been working with utility companies and major data center developers on a voluntary initiative aimed at preventing AI-related electricity demand from disproportionately increasing power bills for existing customers. People familiar with the discussions have said participating companies are expected to pledge to help ensure current ratepayers are not required to absorb the full costs of AI infrastructure expansion.
The surge in demand is being driven largely by investment in artificial intelligence infrastructure. Gartner forecasts global data center electricity consumption will rise 26% in 2026 to about 565 terawatt-hours, while the International Energy Agency has reported that spending by leading technology companies on AI infrastructure continues to accelerate, placing increasing pressure on electricity systems worldwide.
Utilities and energy companies are responding by pursuing new generation projects, including natural gas, renewable energy and battery storage. German utility Uniper said on Friday it plans to invest €5 billion by 2030, with part of its strategy focused on supplying electricity to data centers at existing power plant sites.
Industry analysts say expanding electricity generation and transmission will be essential to accommodate long-term AI growth. Bank of America estimates the United States could require more than 230 gigawatts of new generating capacity over the next five years, substantially exceeding currently planned additions, underscoring the scale of investment needed to meet rising power demand from data centers.
