Senators Count the Shady Ways Data Centers Pass Energy Costs On To Americans (arstechnica.com) 53
U.S. senators are probing whether Big Tech data centers are driving up local electricity bills by socializing grid upgrade costs onto residents. Some of the tactics they're using include NDAs, shell companies, and lobbying. Ars Technica reports: In letters (PDF) to seven AI firms, Senators Elizabeth Warren (D-Mass.), Chris Van Hollen (D-Md.), and Richard Blumenthal (D-Conn.) cited a study estimating that "electricity prices have increased by as much as 267 percent in the past five years" in "areas located near significant data center activity." Prices increase, senators noted, when utility companies build out extra infrastructure to meet data centers' energy demands -- which can amount to one customer suddenly consuming as much power as an entire city. They also increase when demand for local power outweighs supply. In some cases, residents are blindsided by higher bills, not even realizing a data center project was approved, because tech companies seem intent on dodging backlash and frequently do not allow terms of deals to be publicly disclosed.
AI firms "ask public officials to sign non-disclosure agreements (NDAs) preventing them from sharing information with their constituents, operate through what appear to be shell companies to mask the real owner of the data center, and require that landowners sign NDAs as part of the land sale while telling them only that a 'Fortune 100 company' is planning an 'industrial development' seemingly in an attempt to hide the very existence of the data center," senators wrote. States like Virginia with the highest concentration of data centers could see average electricity prices increase by another 25 percent by 2030, senators noted. But price increases aren't limited to the states allegedly striking shady deals with tech companies and greenlighting data center projects, they said. "Interconnected and interstate power grids can lead to a data center built in one state raising costs for residents of a neighboring state," senators reported.
Under fire for supposedly only pretending to care about keeping neighbors' costs low were Amazon, Google, Meta, Microsoft, Equinix, Digital Realty, and CoreWeave. Senators accused firms of paying "lip service," claiming that they would do everything in their power to avoid increasing residential electricity costs, while actively lobbying to pass billions in costs on to their neighbors. [...] Particularly problematic, senators emphasized, were reports that tech firms were getting discounts on energy costs as utility companies competed for their business, while prices went up for their neighbors.
AI firms "ask public officials to sign non-disclosure agreements (NDAs) preventing them from sharing information with their constituents, operate through what appear to be shell companies to mask the real owner of the data center, and require that landowners sign NDAs as part of the land sale while telling them only that a 'Fortune 100 company' is planning an 'industrial development' seemingly in an attempt to hide the very existence of the data center," senators wrote. States like Virginia with the highest concentration of data centers could see average electricity prices increase by another 25 percent by 2030, senators noted. But price increases aren't limited to the states allegedly striking shady deals with tech companies and greenlighting data center projects, they said. "Interconnected and interstate power grids can lead to a data center built in one state raising costs for residents of a neighboring state," senators reported.
Under fire for supposedly only pretending to care about keeping neighbors' costs low were Amazon, Google, Meta, Microsoft, Equinix, Digital Realty, and CoreWeave. Senators accused firms of paying "lip service," claiming that they would do everything in their power to avoid increasing residential electricity costs, while actively lobbying to pass billions in costs on to their neighbors. [...] Particularly problematic, senators emphasized, were reports that tech firms were getting discounts on energy costs as utility companies competed for their business, while prices went up for their neighbors.
Color me shocked (Score:5, Insightful)
Privatizing profits while socializing risk and cost? Hell, that's practically the blueprint for multinationals nowadays.
Re:Color me shocked (Score:4, Insightful)
This is what I heard after reading TFA, "We hear you and your friends are making money without including us. No respect! This is our neighborhood. You and your friends should show us some respect. You should let us wet our beak a little. We hear you and your friends are making a lot of money, and you should let us in on the action, for your own protection -- and we'll forget the insult. You young punks have to learn to respect people like us! Otherwise the cops will come to your house, and your family will be ruined. Of course, if we're wrong about how much you made, we'll take a little less. And by less, I only mean a little bit less. Now don't refuse us."
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Re: Color me shocked (Score:2)
Depends on if a Senator swore a loyalty oath to their party, or still believe in the oath the swore before entering office.
Re:Color me shocked (Score:5, Insightful)
The demarcation between responsible representative democracy and oligarchal kleptocracy is as thin as the legislation regulating political contributions.
NDAs? (Score:5, Insightful)
Re:NDAs? (Score:5, Interesting)
Non-Disclosure Agreements are a giant red flag.Any politician who signs one must be prosecuted immediately for undermining democracy, violating transparency laws and corruption. If someone asks you to sign an NDA, you know something extremely fishy is going on.
Not so sure I’d agree that NDAs are default “fishy”, but you are absolutely correct. And let’s be accurate here. Any Representative who is signing NDAs to hide key information from their constituency, is NOT a Representative. That is a fucking politician. And it’s long past time we make politician a four-letter word.
Those are elected officials. They come crawling, begging for your vote every few years. If they’re guilty of this, that blacklist should shine in Times Square until the mid terms. Remind them and any other cocksucker cunt politician this is what happens when you forget who your actual constituency is.
Hell yes both sides. I may favor one over the other, but integrity for all. Fuck ‘em if they’re guilty. Don’t care what flag they’re waiving. If they can’t Represent, they need to be gone. Plain and simple.
And enough with the fucking Insider Trading. Pelosi should be in prison for suggesting that shit is some kind of Congressional job perk. That only fuels motive for Representatives to act like fucking politicians. Maybe after a market crash we’ll rethink that job perk.
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You, my friend, are an acting politician.
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A politician is by definition anyone doing politics. You trying to influence us to agree with you and ideally taking action the way you want it is the very definition of someone doing politics.
You, my friend, are an acting politician.
The American definition of politics turned into an Us vs. Them shit-slinging festival rife with corruption abusing Weapons of Mass Distraction (social media) to hide all the smoke billowing from behind the Congressional Insider Trading curtain that allowed an entire stock market to be corruptly captured by a "magnificent" seven.
That's about as "political" as PT Barnum needed to get.
America is a single country. Those Representatives within their respected districts are supposed to Represent everyone. Even
Re: NDAs? (Score:1)
As much as NDA involving public officials is problematic, there can be legitimate grounds for having them, for limited time frames.
When a company is looking to locate to an area, they need to line up land and resources. If everyone knows that company Z is looking to acquire land, speculators may jump in and artificially drive up prices. There can be a few other reasons as well.
Hiding info from the public because the plan is to stick the public with the costs is bad. Look into the shady AF tax diversions.
NDAs should be invalid in court (Score:3)
You want to sign an NDA to stop your business secrets from getting out? Fine.
But that should not let you refuse to talk to the law.
Imagine a crook that says, "I am sorry, but my NDA with the Cartel prevents me from revealing how we get the Cocaine here."
That is NOT any different from a car repair business saying "I am sorry, but my NDA with TESLA prevents me from talking about the safety issues with their breaks.
Or a cop saying his NDA prevents him from revealing how he suspected the criminal.
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Meanwhile (Score:5, Insightful)
Meanwhile their voters parrot attack against Big Oil. What did that other article today say, each rack uses 350kw now? Wow. Why even buy energy efficiency anything around the home when Big Tech comes in with their big money, vacuums up the power like a black hole, and blows up the price for the avg person? Not just that but wrecks the environment with much of that power comes from some toxic renewable like wood chips, fossil fuel like a combined cycle natural gas plant, or some other unclean source. Or the environmental toll of all the water used to cool. Or concrete/construction for new buildings. For what, LLMs? Sure datacenters are needed, but what on earth is going on with the buildup recently? For example land going for $615m for 97 acres in New Loudoun ($6m an acre). What will they last, 3-4 years before the racks of GPUs burn themselves out and need replacements? Yet when I go to checkout at a grocery store, plastic bags are banned for the environment. Hmm.
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Nice list. Not every day my eyes are widened a bit more as to the ripple effect.
To your point we shouldn’t make this purely about electricity costs. By doing that, Greed will focus on ONLY that as a “solution” to perpetuate their ongoing environmental harm. One day, they’ll try and win over an entire city they crushed electrically by saying they’ll pay everyone’s electric bill.
Meanwhile, new homes are limited to 50A mains, a clothes dryer requires a license approved by
Deception is undemocratic (Score:5, Insightful)
I'm mostly a free market guy, and it's because of the consequences. Any time we naively try to reorganize society to be nicer for everyone in it, the unintended consequences (the created incentives) screw things up. Like how price controls create shortages and black markets. Or if you ever nationalize anything, people get cold feet about investing for the next hundred years. These principles favor honoring deals, and not ever writing legislation that loots a company (like changing zoning laws so they can't do what they've invested in).
But deceiving voters is worse. If voters were deceived, there was no deal. My naive take (feel free to disabuse me) is that the company didn't really have a reasonable expectation of being able to build the data center and can't complain if the city unexpectedly creates a water/noise tax that would make the data center uneconomical.
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When "Free Market" also supports giving the very wealthy a lower percentage tax rate on their income compared to people who earn under $100,000 per year, shouldn't that be seen as a negative consequence for society just to benefit those wealthy people and the politicians they are buying with their unlimited "campaign contributions" that Citizens United has allowed?
Remember, the idea of rules and regulations aren't to "reorganize society", it is to prevent problems that harm people. The whole idea of the R
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I support taxes. I'm not sure what level is best for society. Hope that clarifies everything!
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This is correct, taxes, even very high taxes, are critical aspects to capitalism and that should be far more widely accepted.
Re:Deception is undemocratic (Score:5, Insightful)
The free market gave us rather dangerous smog in several cities and dangerous water before the EPA got on the case*. The private insurance industry (among others) is responsible for out of control medical costs, and it is not going to fix the problem or be part of a solution. OSHA shut down dangerous workplace practices that those nice corporation inflict on their workers*. NHTSA got rid of many dangerous practices*. Should I continue or are you so mired in "free market" double-speak that you are beyond reason.
*Well, they did before the current alleged administration.
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Where did I imply any of that?
Mostly. I'm mostly a free market guy.
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It's not the "unintended consequences" though, those consequences are all the ACTUAL INTENTIONS of everything lobbyists ask for. You want the regulations for your industry to be flaky as fuck so you can make the most money so that you can keep tweaking the legal system in your favour to make more money. it's not retarded, it's capitalism!
They are and nobody will do anything about it (Score:4, Insightful)
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The vast majority of those of us in the USA and really, in most places, are NOT the ones pushing all these AI data center expansions. Only the wealthy and those who bought stock have seen any benefit from the AI bubble, and even though my 401k also shows a gain from it, when the bubble pops, it's going to be bad for the retirement accounts for those of us in the USA.
Re:They are and nobody will do anything about it (Score:5, Insightful)
Re:They are and nobody will do anything about it (Score:5, Informative)
You shouldn't confuse the Clinton-Democrats for being on the left. Those "centrists" are really a bit on the right, they embrace conservatives like Joe Manchin and then attack any progressives, who are the ones trying to move things back to the left after decades of Republicans pulling politics in the USA far to the right.
Remember, the Republican platform from the 1950s is actually quite a bit to the left of where the Democratic Party establishment is these days.
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You're talking about before the "southern strategy", back when the democrats used to support the Jim Crow south. The democrats have always been about "big government" / nanny state , and the republicans have been against big government, just the motivations for big government have changed over time.
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Didn't know Ds owned all the farms.
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Meanwhile left wingers completely ignore the electric grid demand of electric vehicles, or adding millions of economic migrants, will put on an electricity grid funded largely by publicly regulated utilities, whose publicly elected regulators will refuse to allow them in increase costs, to the extent that their electric grids are so dangerous they start massive fires, the fires of which they will blame on global warming instead of paying for forest / line maintenance costs, while at the same time suing the
My rural town (Score:5, Interesting)
This is going on right now in my rural town in Virginia, as they are planning a massive AI datacenter in an industrial park created about 20 years ago that has been mostly empty (except for a few massive tenets, like one of the largest Gatorade plants in the US at 1 million square feet). Environmental groups have already seeded the community with fear (we have this cut-throat Facebook gossip page that was posted to, and now everyone is up in arms). People have been flooding the county supervisor meetings and so on.
Just in the last couple days the county released a much more detailed explanation of the datacenter's consumption of both electricity and water, but I don't think it's eased people's minds much. Our power is supplied by American Electric Power, which has over 5 million customers and very deep pockets. We also have close to 100 MW of solar farms, and two hydroelectric dams on the New River at the edge of the county, and very robust power infrastructure here. So I don't think there would be any regional issues with power (as compared to other states that have much smaller and even municipal-level power companies that have to pass infrastructure spending onto a much small customer base).
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I see, so if they can pass the data center inflicted extra costs on a large customer base, then it is okay. Thanks for showing just how thought-constipated is your reasoning.
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I see, so if they can pass the data center inflicted extra costs on a large customer base, then it is okay.
Yes, exactly. If my power bill goes up because a datacenter was built somewhere in Arkansas, Indiana, Kentucky, Louisiana, Michigan, Ohio, Oklahoma, Tennessee, Texas, Virginia, and West Virginia, then I'd prefer the datacenter to be built where my local tax base can get revenue, in addition to employing people in my county.
Ok, but (Score:2)
They will do nothing to address the issue
Double Standard (Score:4, Insightful)
But data centers with city-sized demand can hook up, no problem, and all customers bear the burden. Sounds like a double standard to me.
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Yes, because tbh alot of this power is coming online when the electricity is not needed, e.g. in the middle of they day, and not present in the middle of the night. Moreover, they are not always located close to where the other transmission lines might be, so these companies have to acquire the "right of way", just like a railroad or a city street might, which is a time consuming process of taking people's land rights away. Meanwhile alot of these datacenters are literally being built where former coal plan
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Yes, because tbh alot of this power is coming online when the electricity is not needed, e.g. in the middle of they day, and not present in the middle of the night.
IMO, if you're going to building a commercial "solar farm", then that also says you should be adding battery storage* at the same time, and enough of it to run for at least 4 hours after sunset. The reason for picking 4h is that generally gives power until people go to bed and the power needs really drop.
*Actual battery storage not required if you have pumped water, pumped air, or some other storage mechanism. The point is to have storage that can be used to produce electricity when the solar panels can't.
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Ahh, yes... build a battery backup to store the excess power... you're assuming there _is_ excess power, of course... which there won't be because whatever outfit that runs the LLM-AI server farm (data center) is going to be cramming more and more servers into every nook and cranny (stuff them in the HVAC ducts, duct-tape them to walls, make the office doors out of servers). And, of course, when they decide it's "time to upgrade", that'll mean increasing the power demand of the facility... all so you can
Now do football stadiums... (Score:5, Informative)
Senators have been "democratizing" projects like football stadiums and "public works" projects they want for years. Now that they can get some political grift out of it they suddenly have a problem with it..
Insanity. (Score:1)
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They are doing the same thing as the housing developers, the problem is that the energy companies have been underinvesting in their core infrastructure for years, which led to things like Texas going without power several winters ago, and Pacific Power causing fires with their electricity lines.
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Interesting link on the mechanics of power market (Score:2)
I found this to be an interesting article on how electricity rates are established by the various regional grid operators.
https://finance.yahoo.com/news... [yahoo.com]
tldr; there are auctions where the grid operators (lines and transmission) tell the power plant operators (nat gas, nuclear, renewable, etc) how much power they will need in the incoming years. Generating capacity (new plant, new turbines, etc) takes time to build out.
"Historically, the auctions were held three years
typical (Score:1)
that's great, bit of a double standard though, what about somebody counting the things senators have cost us
See sig. (Score:2)
n/t