A report analysing capital spending plans from 51 investor-owned utilities finds the $1.4 trillion figure is double what was invested in the prior decade. More than 30 utilities cited data centres as a top growth driver. Average residential electricity prices are already projected to rise 5.1% this year.
US investor-owned utility companies are planning to spend $1.4 trillion on electricity infrastructure between now and 2030, more than double what was invested in the prior decade, as the data centre boom driven by artificial intelligence creates an unprecedented surge in electricity demand. That is the central finding of a new report from PowerLines.
This nonpartisan nonprofit consumer education organisation analysed capital expenditure plans from 51 investor-owned utilities collectively serving 250 million US customers.
The $1.4 trillion figure represents an increase of more than 20% from the same utilities’ 2025 projections, and Fortune reported it is up 27% from the $1.1 trillion projected a year ago.
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A majority of the 51 utilities cited data centres as a top driver of their capital expenditure plans, and more than 30 named data centres as a specific growth and spending driver through 2030.
US data centres consumed more than 4% of the country’s total electricity in 2023, according to the MIT Energy Initiative; that figure could rise to 9% by 2030, the same research group projects.
Deloitte’s 2026 Power and Utilities outlook estimates data centre demand alone could reach 176 gigawatts by 2035, a fivefold increase from 2024.
Additional drivers of the capex surge include decaying infrastructure requiring replacement, grid hardening against increasingly severe weather events, growing electrification of transport and heating, and population growth, most of the growth in recent years is unrelated to AI, but the data centre boom is widely expected to become the leading driver going forward.
The consumer implications are the most contested part of this story. Utilities typically recover capital expenditure through rate increases approved by state regulators, and electricity bills have already risen approximately 40% since 2021, according to Fortune.
A separate PowerLines report earlier this year found 56 million Americans will face higher utility bills due to rate hikes regulators approved in 2025. The US Energy Information Administration projects average residential electricity prices will rise a further 5.1% in 2026.
If current trends continue, PowerLines estimates that residential customers could end up bearing the cost of nearly half of the $1.4 trillion in planned utility capital spending, around $700 billion.
However, the outcome is not fixed. PowerLines notes that large new electricity consumers such as data centres can, if structured correctly, apply downward pressure on rates by providing utilities with more revenue to spread fixed costs across a broader customer base.
Edison Electric Institute president and CEO Drew Maloney made this case directly: “When more customers come onto the system,including large new users, we can share the fixed costs more broadly, putting downward pressure on rates for all customers.”
The degree to which that materialises will depend on how state regulators structure cost allocation between residential and industrial customers as utilities process an investment cycle without modern precedent.
The grid is also struggling with capacity constraints that compound the investment challenge. North American Electric Reliability Corporation data cited by Morningstar shows load growth increasing from a previously estimated 6.1% to approximately 11.6% over the next decade.
Capacity auction prices in the PJM Interconnection, which oversees the largest competitive wholesale electricity market in the US, have surged from historical norms below $100 per megawatt-day to capped levels above $329 per megawatt-day for the 2026/27 and 2027/28 delivery years.
Meanwhile, approximately two terawatts of capacity sit stuck in interconnection queues, nearly twice the currently installed capacity, according to Deloitte.