ChatGPT and the AI wave cause electricity prices in the US to skyrocket

Power transmission line. Illustration photo: REUTERS/TTXVN

The trend runs counter to President Donald Trump's pledge to provide cheaper energy to American households, the sources said.

Specifically, electricity consumption is skyrocketing due to the development of AI data centers, especially concentrated in the area known as “data center valley” in the state of Virginia. Since ChatGPT became popular, the demand for AI computing has increased dramatically, putting great pressure on the national power system.

Experts warn that this wave – combined with slow rollout of new energy projects and closures of old plants – is forcing power companies to make large-scale investments in infrastructure.

PJM, which operates the grid serving about 65 million people in 13 states and Washington, DC, said it will spend $16.1 billion on generators to meet demand between mid-2026 and mid-2027, up 10% from the previous year. Consumers are expected to see their electricity bills rise as much as 5%.

The rising pressure on electricity prices is a blow to President Trump’s repeated pledge to cut household energy costs in half. Electricity prices have risen 5.6% over the past year, compared with a 2.7% increase in overall inflation, according to the Labor Department.

“This is bad news for consumers,” Timothy Fox of ClearView Energy Partners told the Financial Times. “The higher winning bids will continue to increase customers’ electricity bills.”

PJM had to cap prices after electricity auctions surged 800% last year. These auctions determine how much power plants pay during peak demand periods to avoid blackouts. But this year’s auctions still came close to the cap, at $329 per megawatt-day.

Rising energy costs are also exacerbating inflationary pressures, partly due to Mr Trump’s own policies – including global import tariffs and a “big and beautiful” infrastructure bill – both of which have contributed to the financial burden on Americans.

Analysts warn that the shortage could worsen in the coming years. PJM forecasts an additional 32 gigawatts of electricity demand by 2030 – much of it from data centers. As a result, tech giants like Amazon are scrambling to find more power, pushing up prices even further.

According to HAI VAN/News and People Newspaper

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