Sense. Elizabeth Warren (D-MA), Chris Van Hollen (D-MD) and Richard Blumenthal (D-CT) the letter shot out on Tuesday to Google, Microsoft, Amazon, Meta and several major data center developers to examine the impact they are having on Americans’ utility bills.
The move comes as rising electricity rates become an increasingly pressing issue in the United States, which has far more data centers than any other country in the world and has seen waves of local opposition consequently to these objects. After more than ten years, energy demand is suddenly increasing without major changesthanks in gigantic part to novel data centers that are underpinning the generative AI boom. Lawmakers say utilities are passing costs on to consumers by building novel power plants and transmission lines to meet demand for data centers.
“American families finance trillion-dollar tech companies’ electricity costs”
“Through utility price increases, American families are financing the electricity costs of trillion-dollar tech companies” – the letter says. “Energy use in data centers should not come at the expense of energy availability and affordability for American families.”
Data centers account for over 4 percent electricity consumption in the country – this is the number that the United States Department of Energy expects to achieve 12 percent by 2028. Artificial intelligence increases the amount of energy needed by data centers to perform more complicated tasks. And even if the AI bubble bursts, other payers may do so stuck with the bill for novel energy projects, which in the meantime have a breakthrough character.
It is hard to estimate how much of the burden will be borne by individual consumers, in part because powerful technology companies brokered deals with utilities behind closed doors and asked local officials to sign NDA agreements limiting the amount of information made public. In many cases, data center developers do not even disclose who their tenants will be.
In an attempt to lift the curtain, the three senators asked the companies to respond to a long list of questions in their letter by January 12 next year. Topics range from data center electricity consumption and company expansion plans to lobbying efforts for local regulations. The senators sent a letter to Google, Microsoft, Amazon and Meta, as well as data center developers CoreWeave, Digital Realty and Equinix.
Microsoft and Meta declined to comment on the matter Edge. Google and the three data center developers did not immediately respond to an inquiry Edge.
Amazon spokeswoman Lisa Levandowski wrote in an email that “Amazon covers its own electricity costs and we challenge anyone who claims otherwise to come forward with their data.” Lewandowski pointed to report Funded by Amazon, it says its data centers generate more revenue for utilities than it costs to operate the facilities.
Lewandowski also cited, among others: December report from researchers at Lawrence Berkeley National Laboratory, who found that rising demand for electricity can actually lower average retail electricity prices by spreading the cost among more customers. However, this study notes that this trend tends to benefit gigantic non-residential customers. The researchers based their conclusions on data from 2019 to 2024 and cautioned that it is “unclear” whether the same pattern will hold in the future if electricity demand continues to grow.