{"id":43479,"date":"2025-08-19T12:24:27","date_gmt":"2025-08-19T17:24:27","guid":{"rendered":"https:\/\/www.citizensutilityboard.org\/?p=43479"},"modified":"2025-12-17T07:24:24","modified_gmt":"2025-12-17T13:24:24","slug":"how-data-centers-are-raising-our-bills-in-illinois-and-what-we-should-do-about-it","status":"publish","type":"post","link":"https:\/\/www.citizensutilityboard.org\/blog\/2025\/08\/19\/how-data-centers-are-raising-our-bills-in-illinois-and-what-we-should-do-about-it\/","title":{"rendered":"How data centers are raising our bills in Illinois\u2013and what we should do about it"},"content":{"rendered":"

[vc_row][vc_column][vc_column_text]\"\"<\/a>There\u2019s been a lot of buzz about the impact of data centers on electricity demand\u2013<\/span>CUB Illinois Executive Director Sarah Moskowitz recently spoke at length about it on a Chicago radio station<\/a><\/strong>. This Q&A attempts to get through the hype and give Illinois consumers some facts.\u00a0<\/span><\/p>\n

What are data centers?<\/strong><\/p>\n

A data center is a facility that houses computer systems used for storing, processing and distributing data.\u00a0 A growing number of these facilities are used to power artificial intelligence. A <\/span>report by Illinois PIRG, Environment Illinois Research & Education Center and Frontier Group<\/a><\/strong> shows that <\/span>the number of data centers in the United States about doubled between 2021-2024, and Chicago is one of the nation\u2019s biggest data center markets. Released in January, the report said at the time that data centers drew 5.43 percent of all the electricity consumed in the state. That was expected to grow\u2013the Chicago Sun-Times reported last December that <\/span>30 more<\/a><\/strong> data centers were planned in the state. But as CUB pointed out in that article, such centers don\u2019t always get built\u2013and it\u2019s a big problem if such \u201cphantom data centers\u201d needlessly add to our costs. (But more on that later.)\u00a0<\/span><\/p>\n

How much energy do they use?<\/strong><\/p>\n

A lot! Our friends at the <\/span>Citizens Utility Board of Minnesota reported<\/a><\/strong> that a single Amazon data center being built in that state <\/span>will require 600 MW of power<\/a><\/strong>\u2013 roughly equivalent to the power demand of an entire city.<\/span><\/p>\n

The <\/span>PIRG\/Environment Illinois\/Frontier Group report<\/a><\/strong> found that while everyone projects a significant increase in power demand from these centers, the estimates vary and are \u201chighly uncertain.\u201d It pointed to the Electric Power Research Institute, which estimated that data center electricity demand could grow anywhere from 29 percent to 166 percent (from 2023) levels by 2030.\u00a0<\/span><\/p>\n

Are data centers impacting our electric bills in Illinois?\u00a0<\/strong><\/p>\n

Yes\u2013painfully so. On June 1, ComEd and Ameren customers were hit with<\/span> price spikes<\/a><\/strong>, due to a surge in power demand and poor policy from power grid operators that have failed to adapt to the changing energy market, including this new challenge of data centers. Those spikes have cost customers hundreds of dollars in higher power bills this summer\u2013with <\/span>some consumers complaining of triple-digit increases<\/strong>.<\/b><\/a><\/p>\n

The direct reason for these bill increases is a surge in the cost for reserve electricity, also called \u201ccapacity.\u201d Capacity prices are set by auctions run by the grid operators, PJM Interconnection for ComEd customers and the Midcontinent Independent System Operator (MISO) for Ameren customers.\u00a0<\/span><\/p>\n

The <\/span>Associated Press reported<\/a><\/strong> that the <\/span>Independent Market Monitor<\/a><\/strong> for PJM showed that 70 percent \u2014 or $9.3 billion \u2014 of this year\u2019s increase in electricity cost was the result of data center demand.\u00a0<\/span><\/p>\n

PJM has already run its 2026\/27 auction, where the capacity price surged to yet another record, beating the previous year. As <\/span>Clara Summers, manager of CUB\u2019s Consumers for a Better Grid Campaign, has already reported<\/a><\/strong>, the <\/span>biggest contributor to this most recent auction spike was \u201clarge loads,\u201d meaning big customers that use a lot of energy, such as\u00a0 data centers.\u00a0<\/span><\/p>\n

The issue is so pronounced that in August, PJM’s Market Monitor recommended that large data centers be required to bring their own generation.<\/span><\/p>\n

How much does data center \u201chype\u201d contribute to higher prices?<\/strong><\/p>\n

When grid operators decide how much capacity we need to buy in the auctions, they are predicting how much electricity we will need in the future. The grid operator uses \u201cload forecasts\u201d to project future electricity demand. Because consumers are on the hook for paying for this future demand, it\u2019s important to get the load forecast right.\u00a0<\/span><\/p>\n

But utilities use wildly different approaches to estimate how much capacity they need. Too often a proposed data center is included in a utility\u2019s load forecast even if it has little chance of actually being built. This drives up prices. One <\/span>expert estimated<\/a><\/strong> that across the nation the number of requests for potential data centers to connect to the grid was 5 to 10 times more than the number of actual data centers.\u00a0<\/span><\/p>\n

PJM, the grid operator for ComEd, recently acknowledged the major challenge data centers are posing to grid reliability and is beginning an <\/span>accelerated stakeholder process<\/a><\/strong> to find solutions.\u00a0<\/span><\/p>\n

What are the environmental impacts of data centers?<\/strong><\/p>\n

There are environmental worries in addition to the financial ones. For one, this surge in energy demand could keep outdated, expensive fossil fuel power plants open past their close date. (<\/span>We\u2019ve seen the federal government start to make moves to keep such plants open, at extra cost to consumers<\/a><\/strong>.) There are other environmental concerns: Data centers gulp as much as <\/span>5 million gallons of water a day.<\/a><\/strong> In Dekalb, the Meta data center is using up so much water that it\u2019s <\/span>estimated they\u2019ll be in a water deficit by 2030<\/a><\/strong>.<\/b>\u00a0 High water usage also is a concern connected to the Quantum computing center proposed for South Shore Chicago on Lake Michigan.\u00a0\u00a0<\/span><\/p>\n

So what can be done about this?\u00a0<\/strong><\/p>\n

For one, bringing more electricity to the grid would be extremely helpful, and that\u2019s why CUB has been advocating for reforms at both <\/span>PJM<\/a><\/strong> and <\/span>MISO<\/a>. <\/strong>The grid operators have made new sources of energy\u2013mainly low-cost wind, solar and battery technology\u2013wait far too long (years!) to come online. And in Illinois in 2025, we worked to pass the Clean and Reliable Grid Affordability (CRGA) Act<\/strong><\/a>, which, among a long list of reforms, expands energy efficiency programs and makes it easier to add more battery storage to the grid to deal with the supply-demand imbalance caused by data centers.\u00a0\u00a0<\/span><\/p>\n

There\u2019s a lot more to do, both in Illinois and at the power grid operators. As we\u2019ve said before, here\u2019s CUB\u2019s wish list.\u00a0<\/span><\/p>\n