Some consumers are paying to power data centers that don't exist yet while states ask if demand forecasts are real - 'Nobody really knows' | Fortune

"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."

"Meanwhile, consumer advocates are finding that ratepayers in some areas - such as the mid-Atlantic electricity grid, which encompasses all or parts of 13 states stretching from New Jersey to Illinois, as well as Washington, D.C. - are already underwriting the cost to supply power to data centers, some of them built, some not. "There's speculation in there," said Joe Bowring, who heads Monitoring Analytics, the independent market watchdog in the mid-Atlantic grid territory."

Utilities forecast they will need two to three times more electricity within a few years to power large new data centers supporting AI. Rapid demand growth strains the ability to build new power plants and grid upgrades quickly. Lawmakers, policymakers and regulators question whether such forecasts include speculative or unbuilt data center projects. Ratepayers in some regions are already financing infrastructure and power supply costs for data centers. Analysts warn of an AI investment bubble that could burst, heightening financial risks. No standardized vetting process exists across grids, and uncertainty often stems from developers seeking connections without firm commitments or financing.

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