"The forecasts are eye-popping: utilities saying they'll need two or three times more electricity within a few years to power massive new data centers that are feeding a fast-growing AI economy. But the challenges - some say the impossibility - of building new power plants to meet that demand so quickly has set off alarm bells for lawmakers, policymakers and regulators who wonder if those utility forecasts can be trusted."
"One burning question is whether the forecasts are based on data center projects that may never get built - eliciting concern that regular ratepayers could be stuck with the bill to build unnecessary power plants and grid infrastructure at a cost of billions of dollars. The scrutiny comes as analysts warn of the risk of an artificial intelligence investment bubble that's ballooned tech stock prices and could burst."
""There's speculation in there," said Joe Bowring, who heads Monitoring Analytics, the independent market watchdog in the mid-Atlantic grid territory. "Nobody really knows. Nobody has been looking carefully enough at the forecast to know what's speculative, what's double-counting, what's real, what's not." Suspicions about skyrocketing demand There is no standard practice across grids or for utilities to vet such massive projects, and figuring out a solution has become a hot topic, utilities and grid operators say. Uncertainty around forecasts is typically traced to a couple of things."
Utilities project needing two to three times more electricity within a few years to power massive new data centers driven by AI growth. Regulators and lawmakers question whether such rapid build-out of new power plants and grid infrastructure is feasible and whether forecasts are reliable. One concern is that forecasts may include data center projects that never materialize, potentially leaving regular ratepayers to pay billions for unnecessary capacity. In some regions, like the mid-Atlantic grid, ratepayers are already underwriting power for data centers, built and proposed. There is no standard practice across grids to vet such massive project forecasts, creating uncertainty.
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