- US Senators accuse major technology companies of leaving homes to pay high electricity bills
- Data centers consume hundreds of megawatts, putting severe pressure on regional power grids
- Private contracts hide which companies are actually paying for the energy expansion
Three Democratic US senators – Elizabeth Warren, Chris Van Hollen, and Richard Blumenthal – are pressing big tech companies to explain why electricity bills continue to rise in areas crowded with big data facilities.
Their messaging targets companies that are investing heavily in cloud hosting and large-scale AI infrastructure.
Lawmakers argue that public assurances about absorbing energy-related costs do not keep pace with what consumers experience through rising utility prices.
Tech companies are under fire over electricity bill fiasco
“Tech companies have paid lip service to supporting energy costs in their data centers, but their actions have shown otherwise,” the trio wrote.
“When utilities expand their network infrastructure, they incorporate the cost of expansion into their utility rates, passing the additional costs on to their customers,” they added.
On the same day the letters became public, Amazon released a study commissioned by Energy and Environmental Economics.
The report claims that data center hosting facilities generate enough revenue for utilities to offset the cost of their service.
In some scenarios, the study suggests that surplus revenue could benefit other taxpayers.
However, the analysis relies heavily on model projections and results rather than verified historical billing data.
There is little dispute that modern data centers consume a large amount of electricity.
Facilities supporting AI workloads often require hundreds of megawatts, with some approaching gigawatt-level demand.
Many regional networks were not built for this level of sustainable consumption, forcing utilities to invest billions in new generation, transmission lines, and local upgrades to keep servers reliably online.
According to the senators, utilities typically recover the costs of expanding infrastructure by raising rates across their customer base.
This means that residential and small business users absorb the expenses associated with industrial-scale computing projects.
Research cited in the letters suggests electricity prices could rise 8% nationwide by 2030, with much larger increases in data center-dense states like Virginia.
A recurring concern includes private contracts between utilities and technology companies.
Studies cited by lawmakers indicate that many companies successfully negotiate favorable rates while avoiding direct responsibility for grid modernization.
Confidentiality clauses prevent regulators and the general public from clearly seeing how costs are allocated.
This lack of transparency makes it difficult to reconcile companies’ claims with documented increases in wholesale and retail electricity prices.
“Contracts between data centers and utility companies that set electricity rates and other terms are typically confidential,” the senators wrote.
“Technology companies looking for a location for a new data center are said to use aggressive methods to achieve lower rates…and then [pressure] Utilities to give them favorable rates by suggesting they might build elsewhere instead.
Amazon maintains that its facilities help rather than hurt taxpayers, despite anecdotal evidence and regulatory records that suggest otherwise.
Some areas with heavy data center activity have reportedly seen wholesale energy prices rise sharply in recent years.
Expectations about potential benefits remain difficult to reconcile with current billing trends, leaving open questions about who ultimately pays for the rapid expansion of AI-driven infrastructure.
via Record
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