Data Centers
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Power investigation 02

The grid has received your application.

Berkeley Lab’s reference case puts U.S. data centers at 11.8% of national electricity use in 2030. The demand is real. The grid is not required to remain exactly the size it was before the application arrived.

Inspect the power plan

State case files

Rates fell. Causation has requested a smaller font.

California supplies observed bills. Georgia supplies current relief and signed large-load contracts. The columns are related, not interchangeable.

California · observedPG&E
−11%

overall electric rates since January 2024

The California Public Utilities Commission says PG&E’s overall rates fell 11% as wildfire-cost recovery rolled off. PG&E says it has lowered electric rates five times since 2024. The servers were present. They do not get sole authorship.

Separate utility forecast1 GW → 1–2% lower

PG&E estimates that each additional gigawatt of data-center demand could reduce customer bills 1–2% over time, under the right conditions, by spreading fixed costs.

What moved the latest bill

PG&E’s March 2026 advisory cut a typical 500 kWh non-CARE bill 2.5%. The largest named driver was $479.5 million of wildfire-cost recovery ending. That is observed. The data-center effect is a forward estimate.

Georgia · observed + contractedGeorgia Power
$50

off a typical annual bill beginning June 2026

The current reduction comes from fuel and storm-cost settlements. Base rates are frozen through 2028. The more interesting number begins after that.

Large-load projection · 2029$180 per household

Georgia Power projects about $950 million a year in incremental large-load revenue, enough to lower a typical 1,000 kWh monthly residential bill by at least $15 a month.

Open the OpenAI contract

The 25-year agreement covers 3.2 GW. OpenAI pays the dedicated infrastructure cost and offers up to 1 GW of flexible demand response. The PSC’s wider plan certifies 9,985 MW of new resources, roughly 80% for data centers, with a utility backstop if expected contracts do not arrive. The $180 is projected savings, not a bill already paid.

National evidence

Now ask whether the pattern travels.

The papers disagree because the place, period, exposure measure, and model changed.

State panel · 2015–2024 · arXiv working paper

−0.4%

per 10% more data-center capacity

Watten, Bistline, and Blanford estimate that durable data-center growth modestly lowered average residential retail rates by spreading fixed grid costs across more sales. Their average 2019–2024 state example works out to rates about 6% below the no-growth counterfactual.

What “lower” means

Lower than an estimated world without the additional data-center capacity—not a claim that the price printed on bills fell every year. The authors also warn that generation, transformer, turbine, and transmission constraints could reverse the effect.

County panel · 1995–2020 · NBER working paper

+0.9%

per one-unit increase in log data-center revenue

Alvarez, Argente, Chow, and Van Patten find higher county electricity prices in their baseline shift-share model, alongside more employment, establishments, income, and higher house prices.

With state fixed effects+0.1%not statistically significant
Why these numbers do not cancel out

The papers study different years, geographies, price measures, and definitions of data-center growth. One estimates state retail-rate effects; the other estimates county price changes. They are evidence in tension, not a clean head-to-head test.

Finding 02-B

Load is not a verdict.

California shows falling observed rates plus a separate pro-load forecast. Georgia shows a current cut from other causes plus future savings assigned to signed large-load contracts. Large customers can spread fixed costs or force expensive upgrades. Contract terms and cost allocation decide which effect reaches the household bill.

Michigan19 years · 80% · up to 10 years

One approved DTE contract uses a 19-year term, an 80% minimum bill, and termination charges worth up to ten years of minimum demand. DTE projected about $300 million in benefit to other customers; Michigan’s attorney general is still challenging whether the protections and tracking are strong enough. Projected savings are not observed bills.

Federal6 grid operators

FERC ordered every regional grid operator under its jurisdiction to justify or reform large-load tariffs, with faster connections and consumer safeguards in the same proceeding.

Tennessee Valley11–32 GW

TVA’s 2026 plan identifies that much additional generation capacity through 2040. Its board also modified the wholesale rate structure as data-center demand grows. Rate design and physical supply are being built together because neither substitutes for the other.

The short answer

Build power. Build wires. Send the bill to the new customer.

Efficiency and flexible demand can reduce how much must be built. Neither one manufactures electricity.

Generation

Add actual supply

The IEA expects renewables to meet nearly half of global data-center demand growth through 2030. Gas and coal together still meet more than 40%. The near-term answer is a mixed grid, not a clean-energy slogan.

Transmission

Move it to the load

Power plants do not help a constrained campus without substations and transmission. The IEA says new transmission can take four to eight years in advanced economies.

Rates

Charge the cost causer

Separate large-load rates, long contracts, minimum monthly charges, collateral, and exit fees reduce the chance that a canceled campus leaves households paying for dedicated infrastructure.

Flexibility

Move work away from peaks

Training, batch processing, and spare server capacity can sometimes pause or shift. A Phoenix field test cut one 256-GPU cluster’s power 25% for three hours while maintaining the tested service guarantees.

Efficiency

Do more work per watt

Better chips, networking, cooling, utilization, and software reduce energy per unit of computing. They do not guarantee lower total electricity if demand grows faster than efficiency.

≈50%Renewables
>40%Natural gas + coal

Both numbers belong in the same sentence.

Virginia’s answer

Electricity has not been generated by paperwork.

But paperwork can stop the dedicated bill from wandering into somebody else’s mailbox.

25 MWThreshold for the separate GS-5 large-load class
14 yearsMinimum service commitment for covered new large loads
85%Minimum billed transmission and distribution costs, regardless of use
Panic

Virginia made data centers pay for most of their reserved grid capacity. This confirms the capacity was extremely guilty.

Actual fact

Virginia’s new rules take effect in 2027 and are designed to reduce cost shifting and stranded-infrastructure risk. They allocate cost. Utilities still have to build or procure enough generation and transmission, and rules differ across states and utility territories.

Two pressure valves

Use fewer watts per job. Use fewer jobs at the peak.

Efficiency changes the energy per task. Flexibility changes when the task runs.

Field demonstration

25% for 3h

One cluster stepped down

A peer-reviewed Phoenix test used software orchestration, not new batteries, to reduce a 256-GPU cluster’s demand during peak hours. It does not prove every facility or latency-sensitive workload can do the same.

Manufacturer benchmark

Up to 30×

More agent work per megawatt

NVIDIA reports that Vera Rubin NVL72 delivered up to 30 times the throughput per megawatt of GB300 NVL72 on selected agentic coding trajectories. It is an NVIDIA measurement of a specific workload, pending the named third-party review, not a promise of 30 times lower facility electricity.

A real build

Hyperion did not solve this with a very long extension cord.

The original Louisiana plan added 2,262 megawatts of gas generation plus transmission. That is new supply. It is also new fossil infrastructure.

3Combined-cycle gas plants in the 2025 approved settlement
2,262 MWCombined installed capacity in the initial service plan
2028–29Expected in-service window stated in the regulatory record

Meta’s July 2026 expansion announcement says the broader 5-gigawatt project will fund seven gas-fueled generating plants, three grid batteries, nuclear uprates, and purchased power. That is the proponent’s answer in concrete form: finance incremental supply and grid work, then put the terms through utility regulation. Whether the resulting mix is affordable, reliable, and clean enough remains a legitimate public argument.

The construction hearing

The people building the buildings have entered the chat.

Building-trades unions are fighting for the work. Their support comes with terms.

Michigan Stargate agreement

2,500+

tradespeople and apprentices expected

A project estimate announced by North America’s Building Trades Unions and OpenAI, not a count of permanent facility employees.

Major projects reporting an award

93%*

union contractors

The United Association’s figure covers major projects that reported a contractor award. The asterisk is the denominator, not decorative punctuation.

UA Local 602 case study

+450 / +1,600

apprentices / members in four years

Union-reported growth linked to the data-center buildout, reaching more than 1,360 apprentices and 6,500 members in 2025.

Panic

The opposition meeting has a union section now.

LIUNA says construction moratoriums are not the answer, while demanding project labor agreements, local hiring, apprenticeships, environmental standards, transparency, and ratepayer protection. NABTU is publicly backing responsible-development frameworks and project agreements. IBEW estimates that electrical work absorbs 45% to 70% of a typical data-center construction budget, with Local 26 doing close to 97% of Northern Virginia’s work. Its own warning remains in the file: mega-projects can drain workers from longtime customers, and every boom ends.

The other side of town

One county got 38% of its general-fund revenue. One parish gave teachers a year’s pay.

The fiscal upside can be enormous. It can also be temporary, uneven, subsidized, or badly negotiated.

Loudoun County, Virginia

38%

of FY2026 general-fund revenue

County records say data centers occupied about 4% of commercial parcels while supplying 38% of general-fund revenue. The county used the revenue to support schools and services, lower tax rates, and fully fund a $119.7 million stabilization reserve for data-center revenue swings.

Richland Parish, Louisiana

$50,935

top 2026 certified-employee bonus

Many experienced certified school employees received the full payment, while classified staff received $17,472. The district tied the unusually large checks to construction-driven sales-tax growth and expects elevated bonuses during Hyperion’s buildout.

Panic

Public schools have begun accepting suspicious money from buildings.

Actual fact

The Richland payout is a construction-era windfall, not a guaranteed permanent benefit. Loudoun is a mature, unusually dense market. Neither example proves that every project produces a good net deal after tax incentives, infrastructure, land, noise, water, or power costs.

Source records

Count the megawatts. Follow the money.

01Berkeley Lab, U.S. Data Center Energy Usage Report: 2025 Update2030 reference case and uncertainty scenarios02International Energy Agency, Energy and AIPhysical generation mix and grid-build timelines03Virginia State Corporation Commission, data center initiativesGS-5 rate class, minimum charges, contracts, and collateral04Watten, Bistline & Blanford, Have Data Centers Raised Your Electric Bill?State-level IV estimate of data-center capacity and retail electricity rates, 2015–202405Alvarez et al., NBER Working Paper 35194County-level employment, establishments, house prices, and electricity prices, 1995–202006California Public Utilities Commission, Electric RatesObserved PG&E rate changes and the role of expiring wildfire-cost recovery07PG&E, The Grid Is Growing, and That’s Good News for Your BillFive rate reductions since 2024 and the utility’s 1–2% bill forecast per additional gigawatt08Georgia Power, OpenAI contract approval3.2 GW of demand, full infrastructure cost, 1 GW of flexibility, and projected 2029 customer savings09Georgia Public Service Commission, Data Center Fact SheetLarge-load rules, 9,985 MW resource plan, utility backstop, and ratepayer protections10Georgia Power, Rate ChangesObserved 2026 reduction, base-rate freeze, and the utility’s large-load savings projection11Michigan Public Service Commission, DTE data-center contract19-year term, 80% minimum bill, exit charges, storage funding, and projected customer benefit12Michigan Attorney General, Google data-center contract testimonyRatepayer advocate’s challenge to minimum charges, exit fees, cost tracking, and transparency13FERC, large-load tariff ordersAll six regional grid operators ordered to justify or reform large-load interconnection rules14TVA, Final 2026 Integrated Resource Plan11–32 GW of additional generation capacity through 204015Nature Energy, grid-interactive AI data centersA 256-GPU field demonstration of flexible power demand16NVIDIA, Vera Rubin performance per wattManufacturer benchmark for selected agentic workloads17Louisiana Public Service Commission, Order U-37425Initial Hyperion generation and transmission settlement18Louisiana PSC docket testimony, April 20252,262-megawatt initial generation plan and in-service dates19Meta, Richland Parish expansion announcementBroader generation, storage, nuclear, and purchased-power plan20GovTech and The Advocate, Richland Parish teacher bonusesConstruction-era sales-tax receipts and 2026 payouts21Loudoun County, FY 2026 Budget StoryGeneral-fund share and revenue stabilization22Loudoun County, Data CentersCurrent land-use and tax-base context23LIUNA, statement on responsible data-center developmentSupport for construction paired with labor, community, environmental, and ratepayer conditions24NABTU, Michigan Stargate labor agreementProject agreement and expected skilled-trades and apprenticeship workforce25United Association, Data Centers and the UAUnion-reported contractor awards, apprenticeship growth, operations work, and advocacy claims26IBEW, The Data Center SurgeElectrical-construction demand, local-union growth, and the boom-and-bust labor warning