"Many utilities are citing sky-high estimates to justify new AI data centers from Georgia to Texas and up to Minnesota. The catch? Data center operators submit electricity requests in multiple jurisdictions, hoping that one might pan out. Constellation Energy CEO Joseph Dominguez compared it to fishing: "You put a bunch of lines in the water to try to catch fish," he said. "And the data center developers are doing exactly the same thing.""
"Think of it this way: A developer with plans for one new data center might go to five different utilities, each blind to the other requests. If the utility doesn't have enough capacity, it has to build another plant. Five power plants might get built, paid for with increases to current residential and commercial bills. By the time the developer finalizes its location, it has likely abandoned the other four, leaving new plants in places without increased demand."
Utilities are requesting large spending increases to expand power plants and grid infrastructure to meet projected AI data center demand. Data center operators often submit multiple electricity requests across jurisdictions, increasing apparent demand and prompting utilities to build capacity that may go unused. Building excess capacity shifts long-term costs onto residential and commercial customers through higher bills. Underbuilding risks grid reliability, creating a difficult balance for regulators and utilities. Some regulators and utilities are beginning to push back, but the practice remains common amid already rising electricity costs.
Read at Business Insider
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