Report: electric bills could increase up to 70% in next 5 years to meet data center demand
WASHINGTON, D.C. (7News) — A new report from a D.C. think tank estimates energy prices for Virginians will need to increase by 25 to 70 percent by the end of the decade to meet the growing demand for data centers.
The 23-page study from the Jack Kemp Foundation, The Impact of Data Centers on Energy Demand and Market Prices, predicts that energy prices in Northern Virginia will need to increase by 25 to 70 percent by the end of the decade to meet the growing demand. It states that data centers are expected to use almost half of Virginia’s electricity by 2030.
Ike Brannon, PhD, a senior fellow for the foundation who co-authored this study, explained :
How much it goes up really depends on how creative we are in pricing,
Brannon said, acknowledging this is a more difficult route that customers don’t like.
What some places do is they have adaptive pricing, so the price of energy goes up when the peak hours go up,
Brannon told 7News that data center demand has taken off in the last five years but the power supply hasn’t.
He said.
Something’s going to have to give sometime soon,
Artificial Intelligence (AI), which requires more power, is driving future demand for data centers, according to the study – which states a ChatGPT AI query requires about ten times the amount of power compared to a standard Google search.
The report includes several recommendations to help higher energy costs from trickling down to consumers, including having the AI companies bear the additional costs of the energy they use and building more transmission wires and power plants.
Brannon said,
Either prices are going to go up or you build more supply, or you connect to more supply somewhere else,
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Report: electric bills could increase up to 70% in next 5 years to meet data center demand, source
