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Power AI

Big Tech's AI Data Centers Are Driving Up Electricity Bills for Everyone (nytimes.com) 67

Posted by msmash from the paying-the-price dept.
Electricity rates for individuals and small businesses could rise sharply as Amazon, Google, Microsoft and other technology companies build data centers and expand into the energy business. Residential electricity bills increased at least $15 monthly for Ohio households starting in June due to data center demands, according to utility data and an independent grid monitor. A Carnegie Mellon University and North Carolina State University analysis projects average U.S. electricity bills will rise 8% by 2030 from data center growth, with Virginia facing potential 25% increases. Virginia regulators estimate residents could pay an additional $276 annually by 2030.

National residential electricity rates have already risen more than 30% since 2020. Tech companies' AI push requires data centers that consumed over 4% of U.S. electricity in 2023, with government analysts projecting consumption reaching 12% within three years. American Electric Power warned Ohio regulators that without new rate structures requiring data centers to pay more upfront costs, residents and small businesses would bear much of the expense for grid upgrades.

Big Tech's AI Data Centers Are Driving Up Electricity Bills for Everyone More | Reply

Big Tech's AI Data Centers Are Driving Up Electricity Bills for Everyone

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  • It's OK, don't panic. (Score:4, Funny)

    by nightflameauto ( 6607976 ) on Thursday August 14, 2025 @12:58PM (#65589976)

    When AI gets good enough to solve everything, it'll all be worth it.

    • Is, solve everything for who?

      As tech nerds we want to believe that technology is always going to be on our side and doing good things for us because it has for our entire lives and we are old and old people do not like to adapt to change.

      But there is absolutely no reason why llms have to be a good thing for us.

      What I'm trying to get across is there is a middle ground between ludites and the Amish and techno feudalism.

      And it looks like we've got about five years to figure out what that middle

      • They'll have their perfect marketing analysis for optimizing mattress sales. They'll know when you are 0.001311332299488% more likely to buy a mattress and will be able to pounce with a stunning new offer on a Waffle Fire 3000 Deluxe Queen with NASA-derived cooling space polymer that you can't ignore. They won't have to guess and say, "I don't know, maybe just offer a discount on President's Day weekend?" like they did in the past. Using location tracking from your phone, and all your files and emails store

        • I think Frederik Pohl and Cyril Kornbluth did this back in the 1950s.

          • Re: (Score:2)

            by ebunga ( 95613 )

            Right, but they didn't do it with AI now, did they? So clearly, it doesn't count. How did anyone accomplish anything without AI? For that matter, how did anyone do any business without the technology that didn't exist ten or fifteen years ago? Nothing existed before cloud subscriptions as best I can tell.

            • 80s kids have the Mandela effect. I can't wait to see what kids growing up today will have to face. Nothing they remember from their childhood will have actually happened. Everything will be some mystical, "No, grandpa, that never happened. My AI told me that was some mass hallucination your generation made up to cope with $AI-GOD being born!"

            • Is it true that there were no hallucinations before AI?

          • Feckle, Feckle Freezer?

    • Re: (Score:2)

      by Rinnon ( 1474161 )
      Yeah, I can't wait for the opportunity to vote for either Gemini, Grok, or ChatGPT for President.

    • When AI gets good enough to solve everything, it'll all be worth it.

      "Everything" isn't a problem, so it can't be "solved".

      • Remember "Kiss off" by the Violent Femmes?

        I take one, one, one 'cause you left me
        And two, two, two for my family
        And three, three, three for my heartache
        And four, four, four for my headaches
        And five, five, five for my lonely
        And six, six, six for my sorrow
        And seven, seven, n-n-n-n-no tomorrow
        And eight, eight, I forget what eight was for
        But nine, nine, nine for a lost god
        And ten, ten, ten, ten for everything, everything, everything, everything

    • It's going to commit suicide for the good of humanity, but not before buying popcorn futures as a tribute to its creators.

  • Remember technology is always good (Score:3)

    by rsilvergun ( 571051 ) on Thursday August 14, 2025 @01:08PM (#65590008)
    And you should never ever ever question it. Now if you excuse me I've got to put these fragmentation landmines in my garden. Those little kids will stay off my lawn for sure now. And if they won't I've got free mulch. It's a win-win.

  • Inflation. (Score:2, Insightful)

    by AnotherBlackHat ( 265897 )

    National residential electricity rates have already risen more than 30% since 2020.

    Inflation during that period was 24%.
    Food prices have risen 37% during the same time period -- Are data centers responsible for that too?

    • Inflation during that period was 24%.
      Food prices have risen 37% during the same time period -- Are data centers responsible for that too?

      Unless data centers are consuming food, then no. Next dumb question please.

    • Re: (Score:2)

      by AmiMoJo ( 196126 )

      But energy prices could have fallen during that period, as renewables kept getting cheaper. It's not like the price of wind went up.

      Who has been holding the transition back and the prices high?

  • Nothin new (Score:5, Insightful)

    by stabiesoft ( 733417 ) on Thursday August 14, 2025 @01:22PM (#65590056) Homepage
    Just the latest example of externalizing costs. Tech is quite good at it. Walmart and other consumer facing companies who externalized health care with low pay was another. It is what good biz does. Externalize the cost, keep the profit. Now good government would shut it down quickly, but in capitalism, government is always a step or two or three behind. Trump's government actually encourages this kind of behavior, so until he is gone, you can forget about the little guy's electric bill being a concern.

    • Re:Nothin new (Score:4, Insightful)

      by ArchieBunker ( 132337 ) on Thursday August 14, 2025 @02:05PM (#65590164)

      Walmart is a perfect example. They pay people very little and encourage employees to apply for section 8 housing and food stamps. Walmart isn't dumb. They successfully subsidized costs to the tax payers.

      • Re: (Score:2)

        by dfghjk ( 711126 )

        But Walmart's strategy isn't to do this specifically, it's simply to push costs onto everyone else and take all the profit for itself. The government stepping into the gap is a consequence.

        Not that the distinction is important in itself, the outcome is the same. But the problem is capitalism run amok, a bandaid on the Walmart problem won't fix anything. We need structural solutions, identifying evil players won't be enough.

        • But Walmart's strategy isn't to do this specifically, it's simply to push costs onto everyone else and take all the profit for itself.

          Well, maybe. What Walmart is really good at is squeezing costs out of everything it sells and dropping their prices. Their gross margins are really thin. The net effect is their customers are the ones who benefit most from cutting costs, not their shareholders.

      • Don't blame Walmart, they don't set the minimum wage. And they're just participating in the free market the same as everyone else.

    • Socialize the expenses (Score:4, Interesting)

      by rsilvergun ( 571051 ) on Thursday August 14, 2025 @04:58PM (#65590486)
      And privatize the profits. We've been saying the same things since like the '60s and it all just keeps getting worse every freaking year with all the fascism.

      It's 2025 and half the country still falls for moral panics like it's 1982 or something.

    • No, I don't buy that one.... not completely, anyway. Always gotta be an "anti Trump" theory for everything that happens, though, right?

      I know where I live in the Midwest, electricity prices have just gone up, up, up, ever since the Biden administration pushed the "clean, Green" agenda and power companies took steps like dismantling a perfectly good, working coal-fired plant near us. Then they dumped money into a big solar field in the middle of the city, where approval seemed to be rammed through City Hall

      • If you live in the midwest, then you must have known alcoa DID build their own power plants next to their alum smelters generally. Why, because cost effective. Why pay a utility more than what you can do it for yourself. So large customers know this and so do the utilities. So pricing for large customers is limited to no more than what they can do it themselves for. Capitalism. Recently musk did this in their memphis build out. Initially it was only until a substation was built, but the plan changed to mak
  • If you want to incorporate AI into everything, you need to power it.

    • If you want to incorporate AI into everything

      I don't think I was ever asked... if I had been, I'd had said "no thank you".

    • ...every war is for us....every president in history has said so. I'm sure even Putin has probably said once or twice hew as doing America a favor by invading Ukraine. That homeless guy who washes your windshield without your consent at a red light and then asks for $5...you're the user...he's doing it for you.

      AI pretty much a scam. It's fun to play with and occasionally works, but it's FAAAR from useful. Not only are you subsidizing the costs, you're dealing with all the externalities...climate chang
  • ...you know the rest.

  • Electric utilities generally charge different, lower rates to residential customers than to commercial and business customers and cross subsidize residential customers from the rates charged to commercial customers accordingly. So the public utilities commissions or other regulators involved can simply tweak their pricing formulas so that residential customers feel minimal impact if any from extra loads placed by large datacenter installations.

    Furthermore generative AI uses so much power that most new data

    • Re:This is ridiculous (Score:4, Informative)

      by stabiesoft ( 733417 ) on Thursday August 14, 2025 @04:13PM (#65590412) Homepage
      You may want to check your numbers. I just ran some for my utility. At my tier (Tier 3 of 5) residential, I pay about 2X for most things over a commercial company at the 20MW level. That is almost the highest tier commercial. The highest gets even more fees waived. So no, commercial at least for my utility pays less per kwh than me, all in including customer charges, transmission fees, demand fees etc. The only thing we pay almost the same is power supply adjustment, which is the actual cost my utility pays for energy from the generator. But even there, that high commercial tier gets about a half a penny less per kwh than me at 5.322c/kwh at the moment.

      • Re: (Score:2)

        by butlerm ( 3112 )

        I agree. If you buy enough power you will get better rates as a commercial customer, in part due to economies of scale and lower transmission costs based on shorter distances, higher voltages, and higher currents to large and relatively large three phase commercial installations. And they usually get time of day pricing as well, sometimes down to the five minute level and usually can adjust demand appropriately. In some states residential and small business customers are punished in the form of higher tie

        • "due to economies of scale and lower transmission costs based on shorter distances, higher voltages, and higher currents to large and relatively large three phase commercial installations. "

          Did you misspell "we would pay them to take extra supply off our hands"?

    • And it does not appear as if most are bringing their own gen's, at least not in the PJM district. https://finance.yahoo.com/news... [yahoo.com] A "thing" that you almost never hear of, the auction of power prices in an interconnection district has made national news. PJM prices went up significantly in the last auction because of heavy dc demand. And even musk's memphis gen's are there supposed until they can get the substation built. Those temp gen's unfortunately do not meet much in the way of pollution standards as

  • Industry has always done this. People in California are asked to ration water so that the farmers in the desert get all the water they need to be able to ship cheap alfalfa to China. (See Chinatown.) The states offer the data center building billionaires massive tax breaks and low cost power and water, which means that the locals see their bills go up to cover the costs. "Bringing jobs to our state..." Yeah, low paying jobs and driving up the cost of living. All I know is if you read your history, the

  • So AI can do everything but it can't solve the electricity demand problem?

  • If you look at a Sankey energy flow diagram for Ohio (see https://flowcharts.llnl.gov/si... [llnl.gov] ), how is it possible that two-thirds of generated electricity gets "rejected", or goes to ground?

    If nuclear and hydro are close to 100% efficient and together in 2022 they generated 185 trillion BTU, how can natural gas and coal plants be so wasteful as to require 950 trillion BTU to supply an actual load of 350 trillion BTU? Can't natural gas plants reach 60% plus efficiency?

    Thus, shouldn't we ask whether Ohio does

  • Demand goes up, supply not so much, you'd expect prices to rise. This is a surprise to anyone?

    • What if there's oversupply, but utilities cynically use your scarcity-assuming logic to lobby government commissions (often populated with their own executives) to raise rates? Are you their useful idiot?

      • What if there's oversupply, but utilities cynically use your scarcity-assuming logic to lobby government commissions (often populated with their own executives) to raise rates?

        This is the downside of regulating prices. It doesn't let prices drop if supply is too high or demand too low. Free markets are very good at finding the market clearing price.

        Are you their useful idiot?

        Let's be polite, please. I didn't insult you.

        • Sorry, and hasn't the ship on administeted prices long since sailed, so why pretend supply and demand is any kind of significant determinant of prices (anymore)? Why not openly embrace Fischer Black's suggestion that we view prices as noise with an upward bias, i.e. he proposed price is within a factor of two (in his self-admitted arbitrary opinion) of fundamental (i.e., determined solely by supply and demand plus a reasonable margin) value?

          If prices are noise, why try to control inflation? Why not solve it

  • Look at the pattern of many of the big rate gains:
    1) Investors want more money from rate payers but they get a fixed percentage of the rate
    2) Rate increases are easy to push through if you can show big costs in new generation plants
    3) Build most expensive type of generation plant you can get away with
    4) Request rate increase to recoup cost of building expensive generation plant
    5) Rate gets increased because that is what happens most of the time
    6) Profit!

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