- US Senators Accuse Big Tech of Leaving Households to Pay Skyrocketing Electricity Bills
- Data centers consume hundreds of megawatts, severely straining regional power grids
- Private contracts hide which companies actually pay for electricity expansion
Three Democratic US senators – Elizabeth Warren, Chris Van Hollen and Richard Blumenthal – are pressuring big tech companies to explain why electricity bills continue to rise in areas with big data facilities.
Their letters target companies deeply invested in cloud hosting and large-scale artificial intelligence infrastructure.
Lawmakers argue that public assurances that electricity costs will be absorbed do not match what consumers are experiencing through higher utility rates.
Tech companies criticized for power bill failures
“Tech companies have pretended to support covering the energy costs of their data centers, but their actions have shown otherwise,” the trio wrote.
“When utilities expand their grid infrastructure, they build the cost of the expansion into their rates, passing on the additional costs to their customers,” they added.
The same day the letters became public, Amazon released a study it commissioned from Energy and Environmental Economics.
The report claims that data center hosting facilities generate enough revenue for utilities to offset the cost of serving them.
In some scenarios, the study suggests that excess revenue could even benefit other taxpayers.
However, the analysis relies heavily on projections and modeled results rather than verified historical billing data.
There is little disagreement that modern data centers consume a large amount of electricity.
Facilities supporting AI workloads often require hundreds of megawatts, with some approaching demand at gigawatt scale.
Many regional networks were not built for this level of sustained consumption, forcing utilities to invest billions in new generation, transmission lines and local upgrades to keep servers reliably online.
According to the senators, utility companies generally recoup the costs of infrastructure expansion by raising their customer rates.
This means that residential users and small businesses are absorbing the expense of industrial-scale IT projects.
Research cited in the letters indicates that electricity prices could rise 8% nationally by 2030, with much steeper increases in data center-heavy states like Virginia.
A recurring concern is private contracts between utilities and technology companies.
Studies cited by lawmakers indicate that many companies manage to negotiate favorable rates while avoiding being directly responsible for upgrading the network.
Confidentiality clauses prevent regulators and the public from clearly seeing how costs are allocated.
This lack of transparency makes it difficult to reconcile company claims with documented increases in wholesale and retail electricity prices.
“Contracts between data centers and utility companies that set electricity prices and other terms are generally confidential,” the senators wrote.
“Technology companies looking for a site for a new data center are reportedly resorting to hard-line tactics to get lower rates…and then [pressure] public services to offer them advantageous rates by suggesting they build elsewhere.
Amazon maintains that its facilities help rather than harm taxpayers, despite anecdotal evidence and regulatory filings suggesting otherwise.
Some regions with significant data center activity have reportedly seen wholesale electricity prices rise sharply in recent years.
Projections about potential benefits remain difficult to reconcile with current billing trends, leaving open the question of who will ultimately pay for the rapid expansion of AI-based infrastructure.
Via The register
Follow TechRadar on Google News And add us as your favorite source to get our news, reviews and expert opinions in your feeds. Make sure to click the Follow button!
And of course you can too follow TechRadar on TikTok for news, reviews, unboxings in video form and receive regular updates from us on WhatsApp Also.
