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If your electricity bill appears to be surprisingly high, you’re not mistaken. A significant portion of the increase is due to the rising demand for electricity driven by artificial intelligence.
PJM Interconnection, the largest power grid operator in the United States, reports a sharp rise in electricity usage this summer. Some areas may experience a bill increase of up to 20%. One of the main factors contributing to this trend is the increasing power consumption from data centers that support AI systems like ChatGPT and other generative tools.
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TRUMP ADMIN TACKLES URGENT ELECTRICAL GRID CRISIS AS AI SET TO DOUBLE DEMAND
Electric transmission lines under strain from growing electricity demand (Kurt “CyberGuy” Knutsson)
Why the power grid is struggling to keep up
PJM supplies electricity to 67 million customers across 13 states: Delaware, Illinois, Indiana, Kentucky, Maryland, Michigan, New Jersey, North Carolina, Ohio, Pennsylvania, Tennessee, Virginia, and West Virginia, as well as the District of Columbia. It manages a vast and complex network of power distribution. This summer, the grid is showing signs of strain.
In just the past year, data centers running AI have started using much more electricity. These centers can consume up to 30 times more power than traditional data centers. Most of them are connected to the same grid that serves homes and businesses, which means the cost of that power growth is shared by everyone.
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AI and data centers are fueling a surge in energy use
AI gained momentum in 2023 when tools like ChatGPT became widely adopted. Since then, companies have been rushing to build more infrastructure to keep up. PJM’s territory now boasts the largest number of data centers in the world.
Between 2024 and 2025, electricity demand from AI and data centers in the PJM region contributed to a $9 billion increase in power costs. PJM anticipates peak usage this summer to exceed 154,000 megawatts, with the potential to surpass all-time records during heat waves or emergencies.
AI data center needing high energy demands (Kurt “CyberGuy” Knutsson)
Why electricity prices are rising across the U.S.
While demand is increasing rapidly, the power supply is not keeping pace. Many fossil fuel plants are closing down due to state regulations, aging infrastructure, or market conditions. Over 9,000 megawatts of coal capacity will retire or convert to gas in 2025 alone.
WHAT IS ARTIFICIAL INTELLIGENCE (AI)?
Clean energy options like wind and solar are often the most cost-effective ways to add new power, but developers are grappling with permitting delays, rising costs, and a loss of federal incentives. For instance, the 30% federal solar tax credit for homeowners will expire after 2025. This change is already slowing down new installations.
Large solar farm generating renewable energy (Kurt “CyberGuy” Knutsson)
How AI is increasing your electric bill
Even if you never use AI tools yourself, you are likely still paying for their growth. The expense of expanding the data center’s power supply is distributed among all grid users, including regular households.
PJM customers have been advised to anticipate electric bills increasing by $25 or more per month. Commercial users may see prices rise by nearly 30%.
To help prevent rolling blackouts, PJM is introducing demand response programs that compensate large businesses for temporarily reducing their electricity consumption during periods of high demand. Nevertheless, if electricity usage surpasses 166,000 megawatts, some regions may not have adequate reserve power to maintain reliability.
Tips to reduce your electricity bill
Seeking ways to lower your electricity bill as prices surge? Here are some effective tips you can start implementing today:
- Unplug electronics and appliances when not in use to avoid phantom power drain.
- Upgrade to smart thermostats and LED lighting for increased energy efficiency.
- Operate major appliances (like washers and dishwashers) during off-peak hours.
- Consider adding weather stripping or insulation to block drafts and enhance cooling/heating.
- Monitor your energy usage with smart plugs or an electricity usage monitor for real-time feedback.
For more tips and expert advice, explore the 7 best ways to save money on your electricity bill
Kurt’s key takeaway
AI electricity demand is growing faster than the grid can accommodate. As more data centers come online to power tools like ChatGPT, the strain is evident on your utility bill. Without significant upgrades to infrastructure or smarter energy policies, prices could continue to rise. The technology may be intelligent, but the cost of keeping it operational is becoming increasingly challenging for everyone else to overlook.
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