HARRISBURG, Pa. -- The artificial intelligence boom is leading to fights in some states over growing utility profits, as governors, attorneys general and others protesting rising electricity bills say cash-strapped residents are stuck in a broken system.
Officials and lawmakers in at least six states — including Arizona, Indiana, Maryland, New Jersey, New York and Pennsylvania — are going to new lengths to try to block rate increases proposed by utilities. Some are pressing utilities to completely change their model for financing major system upgrades.
The push comes during a midterm election year in which affordability is the leading theme in Democrats’ attempts to loosen Republicans' control of Washington.
Arizona Attorney General Kris Mayes, a Democrat who is seeking reelection this year, is challenging two utility rate increase requests in front of the state’s utility regulatory board.
“I felt like it’s never been more important to stand up against the blatant corporate greed of our monopoly utilities in Arizona,” Mayes said in an interview.
The voracious energy demands of AI data centers have driven up electric prices in some regions and launched a moneymaking energy-sector construction boom.
For years, consumer advocates have tried to challenge the size of a utility's investment return in front of regulators. But maybe not like this, consumer advocates say.
“We’ve entered into this era of expensive energy and (demand) growth, and we’re seeing utility profits at record highs and rising utility bills,” said Matt Kasper of the Energy and Policy Institute, which pushes utilities to keep rates low and use renewable energy sources.
Utilities were long viewed as a stable haven for investors, with a reliable source of income and predictable demand. Because of that lower risk, the utility's sector investment returns are typically on the low end compared to other sectors, analysts say.
However, utilities — many of which are owned by multibillion-dollar, for-profit parent companies — have seen share prices perform particularly well during the data center expansion.