Data Centers in NC to have $50 Billion Price Tag by 2050
Last week, Gov. Josh Stein’s Clean Energy Task Force released a report that shows large data centers are expected to start using massive amounts of energy over the next several decades. The study, conducted by Energy Futures in collaboration with the Energy Policy Task Force, looked at energy costs and the impacts of various policies in North Carolina. Energy Futures Group’s report made the following findings:
- Large loads will cost $50 billion over the next 25 years. In the business-as-usual scenario, large loads, a majority of which are data centers, account for 85% of new demand through 2035. The rate of load growth projected in the next 15 years is five times the rate that was seen in the past 20.
- Pursuing a net zero target reduces costs for ratepayers. If North Carolina plans for the future now, starts cutting emissions in the mid-2030s rather than later, and puts in place supportive policies like grid-enhancing technologies, it would save the ratepayers $14.6 billion compared to business as usual.
- Letting large load customers bring their own generation saves ratepayers. A program where just half of new large customers directly pay for or bring the clean energy they have committed to and operate flexibly would save other ratepayers $20 billion.
Residential customers could see their electricity bills increase by 70% over the next 15 years to pay for it – meaning regular North Carolinians would pay a higher rate than the giant tech corporations driving up demand for new infrastructure.
Increasing Clean Energy And Making Data Centers Pay For It Could Save $20 Billion
Will Scott, North Carolina policy director for the Environmental Defense Fund, sits on the Clean Energy Task Force and analyzed the report. He said, “This analysis shows North Carolina can lower residential customer electricity costs by up to $20 billion by requiring data centers to contribute their fair share of clean, flexible power.”
North Carolina can meet growing electricity needs reliably while cutting pollution and reducing costs, but only if it makes deliberate choices now about large new energy users, clean energy deployment, and transparency.
“We now know the only affordable path to any data centers in our state is in tandem with clean energy,” said Dan Crawford, NCLCV’s Senior Director of Public Affairs. “We should be weaning ourselves off expensive fossil fuels, not doubling down on these volatile fuel sources. That’s why we support Governor Stein in this effort.”
Large Load Tariff and Clean Energy Transition Tariff Still Needed
Last month, Duke Energy worked with tech giants behind data centers (including Amazon, Google, Microsoft, and a subsidiary of Meta), other large energy users, and the NC Utilities Commission’s public staff, to propose a large load tariff.
Gov. Stein and Attorney General Jeff Jackson both called for the NC Utilities Commission to do more, saying it needs stronger requirements to fully protect customers from paying for data centers’ energy costs.
“Data centers’ large energy loads are going to create $50 billion in costs for all ratepayers, and if nothing changes, families will have to foot data centers’ bills. That’s unacceptable. We need to bring real rate relief for North Carolinians,” said Governor Josh Stein. “The Utilities Commission has the chance to protect people’s utility bills by voting to approve large load tariffs, and I am calling on the commission to get it done.”
“Families shouldn’t pay for the cost of new data centers. That’s what we’ve been fighting for in these cases,” said Attorney General Jeff Jackson. “Duke’s proposal is a real step in that direction, and it puts more of the cost on the data centers, where it belongs. It’s not final yet, and we’re going to keep pushing for more.”
Michelle “Meech” Carter, NCLCV’s Clean Energy Campaigns Director added, “North Carolinians across our state are struggling to make ends meet, and clean energy is one of the solutions to make energy more affordable. Data centers could quintuple over the next few years, and their growth is truly unprecedented. Big Tech and the billions of dollars they bring should be responsible for their energy demand and the infrastructure needed to build it.”
Additionally, a clean energy transition tariff – which would allow data centers to build their own energy sources and incentivize them to use renewable energy – is needed. Currently, Duke does not have a clean transition tariff. The large load tariff it proposed earlier this month also did not include any incentives for data centers to build their own energy.