US Electricity Rates Rise Amid Data Center Energy Demand

Electricity prices across the U.S. have been rising significantly due to a combination of record-high temperatures and the surging energy demands of AI data centers. Tennessee experienced one of the highest electricity rate increases between 2024 and 2025, with a 12.1% rise, while states like Maine and Connecticut saw even steeper hikes. The PJM Interconnection grid, covering 13 states and D.C., expects residential electricity rates to increase by 30% to 60% by 2030, driven largely by the energy needs of Big Tech data centers and resulting capacity auction price surges. Texas is also facing challenges, as its data centers require extensive power infrastructure and water resources for cooling, raising concerns amid ongoing drought conditions. In response to rising energy demands, major tech companies such as Google, Amazon, and Microsoft are investing in nuclear energy to power their AI data centers, while President Donald Trump announced over $92 billion in related investments to address energy infrastructure needs. These developments underscore the growing impact of AI on U.S. energy consumption and the resulting economic and environmental challenges.