Ratepayers Could Be on the Hook for Data Centers’ Energy Use

A report from the Harvard Electricity Law Initiative warns that American energy consumers could subsidize the energy used by data centers by billions of dollars, reports Pam Radtke in Governing. “Data centers are forecast to account for up to 12% of all U.S. electricity demand by 2028. They currently use about 4% of all electricity.” According to one author of the report, because data centers use a disproportionately high amount of energy, “We’re all paying for the energy costs of the world’s wealthiest corporations.” 

In many cases, utilities are still relying on fossil fuel-powered plants to provide the energy required by data centers. Meanwhile, the “perceived benefits” of data centers are failing to materialize. In Louisiana,  “The potential costs aren’t just in bill increases, the paper points out. If utilities can profit from building new generation for data centers, they have no incentive to modernize their systems by switching to renewable or more efficient power, which would provide longer term benefits to customers and the climate.” In northeast Louisiana, a planned data center for Meta will be powered by a natural gas plant, sparking concerns about greenhouse gas emissions.