Electricity costs are surging as America’s power needs climb, driven in part by the growing demand from power-hungry artificial intelligence (AI) data centers, according to data from Energy Information Administration (EIA).
Residential electricity prices have risen nationwide by about 6.5% between May 2024 and May 2025, according to EIA data. The build out of power-hungry data centers needed to sustain AI development in the coming years is expected to put significant upward pressure on U.S. electricity demand, which could drive prices higher yet if available supply does not grow quickly.
“If we are going to keep the lights on, win the AI race, and keep electricity prices from skyrocketing, the United States must unleash American energy,” Energy Secretary Chris Wright said in July as the Department of Energy (DOE) released a report on the U.S. electricity grid that states that blackouts could increase by a factor of 100 by as soon as 2030 if America fails to replace aging energy infrastructure. “In the coming years, America’s reindustrialization and the AI race will require a significantly larger supply of around-the-clock, reliable, and uninterrupted power.”
Only five states saw a drop in electricity prices from May 2024 to May 2025, including Nevada, Hawaii, Iowa, North Dakota and Montana, EIA data shows. States that saw the biggest spike in residential electricity bills in that period included Maine, Connecticut and Utah.
U.S. electricity demand is expected to reach unprecedented levels in the coming years, surging 25% by 2030, according to data from the EIA and a recent ICF International report. After years of relatively flat demand, the sharp rise has prompted an “urgent need” for more electricity resources, according to the major grid watchdog North American Electric Reliability Corporation (NERC).
Growing expectation for the re-industrialization of America is also contributing to rising U.S. energy demand, and aging energy infrastructure that is not being replaced fast enough is straining the grid, according to some energy sector experts.
The Trump administration has drawn attention to America’s growing electricity needs and has moved to ramp up dispatchable energy sources like coal, nuclear and natural gas. In contrast, the Biden administration touted green energy sources like wind and solar as the future of American electricity, an approach the Trump administration and some energy experts have criticized as relying on intermittent and less effective power sources.
“You never know if these energy sources will actually be able to produce electricity when you need it — because you don’t know if the sun will be shining or the wind blowing,” Wright wrote in June.
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