The real reason electricity prices are rising, and it’s not data centers

20 comments

1. This is a convoluted rationalization that data centers don’t drive up electricity rates, consumers do. Academic-sounding bullshit that reads like the PR department of a trade group.

2. Bezos owns WP? And is building 100s of data centers? Not sure if we can say this is credible….makes sense that rising infrastructure costs would increase costs…….but to say data center electrical demand lowers costs is insanely stupid.

3. I think there are some misunderstandings in this article about the way grids operate and the impact data centers can have. BUT, all of this discussion about finding blame for raising prices as a partisan exercise is very bad for the future of the grid. Maintaining a grid is very complicated, and what causes prices to rise is very complicated, usually with many contributing factors. And the more people we have looking for something the blame price increases on, the less people we have looking to understand what is really happening and what (if anything) should be done about it. 

4. So do not allow crypto and AI on grid. Put infra costs into a public bond authority.

5. Did Bezos write this headline? 😂

6. Can’t read it, paywall. Maybe someone can use AI running in a data center to summarize the article, LOL.

7. In my option, electricty prices are going up because:

   1) Power companies believe they are get away with it.

   2) Data centers are using a ton.

   3) Our “brilliant” leader is cancelling a ton of power projects.

8. WaPo is a shill for Jeff Bezos. Nothing they write cab be trusted.

9. At least nobody seems to blame the energy transition for the higher prices here. I guess that’s progress.

10. Get the fuck out of here with this propaganda bullshit.

11. Big data center propaganda

12. Cause the power companies, like every other company in this country, are trying to find out just how much they can raise prices before their customers can no longer pay for whatever they’re selling.

13. I mean, in general they’re right. Prices are going up because power companies are for profit entities that try to minimize costs and reduce long term investments.

    For decades now we’ve been saying that our infrastructure needs retooling. Power production and distribution was not exempt in that. There are very large projects (like data centers) being built in that could have been planned for ahead of time we’re it not be for this mishmash capitalism bullshit we’re being fed.

    End for-profit power, regulate power prioritizing, and remove the barriers from citizens providing power to the grid cheaply.

14. The article is effectively click bait, and intentionally selects a narrative from the report that runs counter to current events in order to make a splash.

    The overall conclusion is correct, when load increases and you have to build additional generation to support it, you wind up with a generally more efficient fleet. The energy portion of retail bills may even go down a little bit. Transmission and distribution have been escalating significantly over the past several years.

    However, the article is also intentionally misleading by presenting only a piece of the industry. There is a section in the referenced report (done by a lab and Brattle) that explicitly discusses how data centers have increased capacity costs drastically in the Mid-Atlantic. The WaPo *serves the mid Atlantic*. In the short term, this is exactly what has caused the most recent escalation in the public’s awareness of grid concerns. To completely ignore this line of events, which is explicitly discussed within the report that the article cites, is very disingenuous in my opinion, and is intentionally selected to get people to click the article and generate engagement. And this Reddit post demonstrates that it worked! I even had a family member ask me about this article this morning.

    So yeah, there is some truth to the article, but I believe the author knew what they were doing to create something misleading and engaging.

15. Paywall?

16. Price demand curves?

    Data centers increase demand. Increasing demand against a very long supply chain usually is inflationary (historically). Electricity generation takes years to come online.

    On top of the basic economics you have state and federal government mucking up the markets with subsidies, discounts, etc.

    I am not sure anyone really knows what is going on in all the various markets

17. Washington Post? Like I give a damn what Jeff has to say.

18. For anyone interested in actually understanding how prices are set:

    https://eta-publications.lbl.gov/sites/default/files/2024-09/basics_of_ratemaking.pdf

    And if you’d like to see some analysis from a solid resource using unbiased data:

    https://eta-publications.lbl.gov/sites/default/files/2025-10/full_summary_retail_price_trends_drivers.pdf

    Investor-owned utilities cannot spend a penny, nor earn a single cent of profit on that spending, without ample regulatory review and approval. Utilities are playing by the rules. If they choose to curtail their spending, then they lose their investors and financially crumble (note: anyone with an index fund or pension would also feel this crumble).

    The rules are horrendously out-of-date. And regulators have the steering wheel here. But they have been far too risk adverse to challenge the status quo (must also overcome the utility lobbyists that engage them)

19. Wait, you mean to tell me the newspaper owned by the guy who owns Amazon, which is responsible for massive data center buildouts all over the country, wants you to believe that the data centers he’s building are not* the reason electric bills are going up? Shocking.

20. The article is claiming data centers don’t drive up electricity rates, deferred maintenance does. And they’re right. The grid is old at this point and a lot of it is being replaced, which is an expensive process. It contains data which shows the share of utility costs coming from electricity production is falling dramatically as distribution maintenance costs skyrocket.

    Utilities don’t get paid for replacing existing infrastructure, they get paid for energy used, and they must divvy the costs of that replacement over all ratepayers, so having more rate payers in the form of data centers means each existing rate payer pays less of it. And the data supports their conclusion. The states where rates are increasing quickly are primarily states where data centers are not locating and electricity demand is falling.

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