> Based on actual auction clearing prices and quantities and uplift MW, inclusion of existing and forecast data center load growth resulted in a combined total increase in capacity market revenue for the 2025/2026 BRA, the 2026/2027 BRA, and the 2027/2028 BRA of $23,100,955,341.

This is the increase in revenue to PJM from adding datacenter customers, and includes both the amount that datacenters paid as well as the amount that other customers paid due to higher prices from datacenters. So Fortune calling it an increase to "the public" means that they didn't read the report they are using as their source and are probably just repeating what they thought someone else meant.

Bloomberg in the past worded it as "data centers will add at least $23 billion to customer bills" in April and "added a minimum of $23 billion to customer bills" in February. Which while technically correct (datacenters are customers) seems meant to be misleading. And now that's the number that's getting thrown around as the increase to "the public".

The part I don't get is that the journalists could just give the actual number for the quantity that they are referring to (the amount that non-datacenters paid due to higher rates due to datacenter loads): when I calculated it a few months ago I think it was something like $16 billion rather than $23 billion. I feel like the story would have the same impact if the headline number was $16B as $23B, but $16B has the benefit of not being a misrepresentation of the situation.

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Also I would definitely recommend checking out the PJM BRA report. It's a bit dense but not too hard to follow, and my personal takeaway was that the PJM market is just very dysfunctional and they are blaming the datacenters instead. I thought SemiAnalysis had a good analysis of it: https://newsletter.semianalysis.com/p/are-ai-datacenters-inc...

Okay but this is a policy choice. It doesn’t have to be that way.

The total revenue for electricity generation was $514b in 2024. So this was a 4-5% increase in costs. And if it is being invested in better generation and our aging infrastructure, that seems fine.

Overview article with links to actual studies: https://cityjournal.substack.com/p/data-centers-arent-raisin...

Perhaps I'm just spoiled because I live in the PNW, where are best use for overcapacity was to ship power off to California. But in the past, cheap hydro attracted aluminum production that then attracted also attracted a whole airplane production industry.

I think most people are just debating whether the extra demand generated by AI is worth it, they weren't necessarily debating the same thing when it came aluminum or airplane production (albeit in the 1930s).

Electricity will cost more because AI DCs need to be cheap, all upgrades cost will be borne by consumers.

Water will be less available and/or cost more because all forms of energy (except solar, wind, hydro) need a TON of water[1]. Which was ~48 trillion gallons in 2021.

As a consequence, nearly everything will cost a lot more. And this is the price we pay for AI. AI has hijacked the supply chains built for existing uses, taken over all the low cost ones. Forcing the rest of humanity to bear the costs of building everything new at a high cost, both high CapEx/OpEx.

These externalities must be accounted for when thinking about how 'cheap' AI is.

--- [1]From: https://www.eia.gov/todayinenergy/detail.php?id=56820

U.S. electric power sector water withdrawals for power plant cooling: 47.7 trillion gallons of water.

The electric power sector uses a large amount of water, mostly for cooling. Thermoelectric power plants (including natural gas, nuclear, and coal plants) boil water to create steam, which spins a turbine to generate electricity. The steam leaving the turbine must be cooled back into water to be used to generate more electricity. Plants withdraw water from nearby rivers, lakes, or oceans and pass that water through the steam leaving the turbine. That process cools and condenses the steam back into water. In 2021, 73% of the utility-scale electricity generated in the United States came from thermoelectric power plants.

The reasons for that are complex but have to do with how electricity pricing works. In many markets the price includes a lot of taxes, fixed cost for providers and infrastructure. Generation is only a minor cost. And on top of that the prices are set in a way that isn't really that flexible.

Infrastructure utilization is a very important here. Grid operators are very conservative with their infrastructure. They want to ensure there's enough to handle the worst case. That means there are a lot of assets that are nowhere near 100% utilized (e.g. cables and long distance transmission). It also means they are very inflexible serving new demand like data centers.

Adding batteries as energy buffers enables a lot better utilization of all these assets. That enables more revenue for the same infrastructure cost. Electricity prices can actually go down if you do that right. With renewables, there is very low marginal cost for generation. It's all infrastructure cost. Anything that improves infrastructure utilization enables more customers to have power that then share the infrastructure cost.

Data centers that are currently powered by things like on site gas turbines are not being very cost efficient. There's an obvious incentive for hyper scalers to invest in infrastructure that will lower their cost. They have access to many billions. They are spending on anything that will get them energy. They are desperate to spend. And they are completely bottle necked on grid operators that are being very conservative. Hence the expensive side hustle with gas turbines. There's a big opportunity here for massive investment in better grid infrastructure. That wouldn't necessarily be payed for by consumers. But they would still benefit from better infrastructure.

The key is unlocking these investments to happen.

Also IMHO, we are building way too many data centers right now. It reminds me a lot of the Y2K dot.com crash, and all of the residual dark fiber.

I spotted this article today that claims it's all in our imagination.

https://www.city-journal.org/article/data-centers-arent-rais...

When my apples are expensive, I don't generally grumble about all the demand from pie makers. If they demand more apples, new suppliers should come in to restore the price, right?

[1] or whatever other "superfood" that explodes in popularity

Oregon approves PGE’s 29.7% rate hike for data centers under landmark law

https://www.opb.org/article/2026/07/07/oregon-data-center-ge...

PJM’s market monitor estimates data-center demand added $23.1 billion to regional wholesale capacity costs across three delivery years through 2028.

The problem is, there are insane and dumb regulatory barriers to adding power plants or interconnects. THESE ARE THE SAME PROBLEMS FACTORIES FACE WHEN RESHORING PRODUCTION, you should treat datacenters as the face of reindustrialization. Instead of complaining about using resources, we need to focus on solving our inability to provide infrastructure needed to support economic growth.