Utilities requested a record-high $31 billion in rate hikes in 2025 across the nation—more than twice the near record from 2024—as consumer and political backlash grows over the AI data center boom that could further contribute to cost increases going forward, according to a new report from nonprofit PowerLines released Jan. 29.
While aging infrastructure, extreme weather events, and natural gas price spikes are leading contributors to electricity prices rising 40% since 2001, the growing electricity demand from the data center construction surge has begun to further drive up rates. Residential retail electricity prices increased 7% in 2025 alone, while piped gas prices rose 11% last year, according to the U.S. Department of Energy.
The majority of the rate hikes requested by utilities are already approved, but nearly half remain pending going into 2026 and could receive increased scrutiny from state regulators, said Charles Hua, PowerLines executive director, especially as pivotal midterm elections loom in November.
“These increases, a lot of them have not actually hit people’s wallets yet,” Hua said. “So that shows that, in 2026, the utility bills will likely continue to rise, barring some major sweeping action.”
