"The AI explosion means millions are paying more for electricity"

Giving new meaning to "Democracy dies in darkness."

From the Washington Post, July 27:

The data centers required for Big Tech are driving up electricity demand — and prices.

This summer, across a vast stretch of the eastern United States, monthly home electric bills jumped. In Trenton, New Jersey, the bill for a typical home rose $26. In Philadelphia, it increased about $17. In Pittsburgh, it went up $10. And in Columbus, Ohio, it spiked $27.

Few customers were happy, of course, but even fewer knew exactly why the rates had climbed so quickly.

“I never know why it goes up,” said Vicki Miller, a retired secretary in Columbus. “But I can adjust the thermostat to save money — I freeze in the winter and roast in the summer.”

This time around, though, it is possible to trace the price hikes in these cities to a specific source: the boom in data centers, those large warehouses of technology that support artificial intelligence, cloud computing and other Big Tech wonders. They consume huge amounts of electricity, and, as they proliferate, the surging demand for electricity has driven up prices for millions of people, including residential customers who may not ever use AI or cloud computing.

In Columbus, for example, households on the standard plan of the local utility began paying about $20 more a month as of June — or $240 a year — because of the demand from data centers, according to a calculation based on figures from an independent monitor overseeing the region’s energy auctions and the local utility, AEP Ohio.

The ranks of the companies building the data centers — Google, Meta, Microsoft and Amazon — include some of the nation’s biggest and most prosperous companies, and many affected residents resent having to pay more because of the tech companies’ rising electricity demand. (Amazon founder Jeff Bezos owns The Washington Post.)

“It’s definitely not fair,” said Alicia Tolbert of Columbus. She does merchandising for department stores, and her husband is a truck driver. “I really can’t afford it.”

“The Big Tech companies suck up the electricity, and we end up paying higher prices,” said Carrie Killingsworth, who works in financial services. “I’m not comfortable with average customers subsidizing billion-dollar companies.”

As data centers pop up across the U.S., energy experts fear their growing needs for power will outstrip supply and the prices will spike for everyone. For years, they have supported an array of e-commerce sites, social media and online video platforms, and the addition of AI applications is now boosting their power usage.

“We are seeing every region of the country experience really significant data center load growth,” said Abe Silverman, a nonresident research scholar focused on energy markets at Johns Hopkins University. “It’s putting enormous upward pressure on prices, both for transmission and for generation.”

Earlier this month, energy regulators in Ohio ruled that data centers must pay more for the upgrades to the grid needed to serve data centers, overruling the objections of the tech companies, who said they were being targeted unfairly. In an emailed statement afterward, industry group the Data Center Coalition said that it was “very disappointed” in the decision....

....MUCH MORE 

These are all regulated utilities and the regulators have been asleep at the switch, so to speak.

From the intro to October 2024's "AI versus the climate as data center emissions soar ":

It is probably time to require higher electricity prices for data centers, not so much to price the CO₂ externalities—that approach to carbon may not be legal in the U.S. if the Supreme Court continues dismantling the administrative state as it forces the Congress to accept and embrace their constitutional responsibilities, think EPA power plant rules—not so much to price the CO₂ externalities but to avoid burdening households with other externalities, the cost of bringing on new generating capacity, the cost of stringing cables and reconductoring existing rights-of-way, the cost of back-up systems and batteries and other storage mediums.

The AI business has a lot of money, OpenAI just raised $6 billion at a $157 billion valuation, or my favorite recent example, the three centi-billionaires Jensen Huang (NVDA), Elon Musk (TSLA+++) and Larry Ellison (ORCL) having dinner at Nobu, Palo Alto, combined net worth at the table $550 billion, with Musk and Ellison begging Huang to get them more chips:

“Please take our money. By the way, I got dinner. No, no, take more of it.
We need you to take more of our money please.”
—Ellison on the table-talk

After that longer than usual introduction here's the story at Asia Times, October 3...