“The state-level data firmly rejects the narrative that data centers drive up electricity prices. That may or may not change in the future, but the most recent data shows that data centers are not responsible for higher electricity rates.”
The conclusion of the Institute for Energy Research is that data centers do not drive up electricity costs.
In a release this week, the Institute declared, “The latest data from the Energy Information Administration (EIA) on electricity prices and sales contradict the narrative that data centers are driving up electricity prices. That may change in the future, but the most recent data shows that data centers are not responsible for higher electricity rates.”
Its report attempts to shoot holes in the cries and criticism of those challenging the massive growth of data centers, not just in Oklahoma, but across the U.S.
“There is no statistically significant correlation between the number of data centers in a state and its current electricity prices. In fact, prices in the top ten data center states are virtually identical to the average across other states. Furthermore, there is no statistically significant relationship between data center concentration and faster increases in electricity rates,” reported the Institute.
Data center opponents and critics have attempted through legislation to adopt moratoriums on their construction. Oklahoma has seen several data center bills filed in this ongoing legislative session and recently, a bill was introduced in Congress to adopt a moratorium.
The Institute raised the question, ” But does the data support this intuition? The answer is no. Although data center growth is helping to drive demand higher, it does not explain why electricity prices have risen significantly in some parts of the country.”
Certainly the demand for electricity is growing as a result of the spread of data centers. One study by the Lawrence Berkeley National Laboratory (LBNL)prepared for the U.S. Department of Energy, U.S. data centers consumed about 76 terawatt-hours (TWh) in 2018 and roughly 176 TWh by 2023, a 131% increase in five years. LBNL attributes the surge primarily to a larger server base and rapid deployment of GPU-accelerated systems for AI workloads. Company disclosures show similar growth at the facility level: Meta’s metered data-center consumption rose from 6.97 TWh in 2020 to 18.06 TWh in 2024 (up 159%), with major campuses in Oregon, Iowa, and Nebraska more than doubling.
The Institute said it examined EIA electricity price and sales data for all 50 states, paired with 2025 state-level data center counts. It ran two sets of tests: first, whether states with more data centers experience faster growth in electricity consumption; and second, whether states with higher or faster-growing electricity consumption experience faster increases in retail prices.
The state-level examples are stark. The five states with the largest sales declines from 2015 to 2025:
- California (−9%)
- Maine (−7%)
- Connecticut (−6%)
- Massachusetts (−5%)
- Hawaii (−4%)
These states saw average price increases of 58%.
The five states with the largest sales gains:
- North Dakota (+67%)
- New Mexico (+37%)
- Texas (+32%)
- Oregon (+30%)
- Virginia (+29%)
These states saw average price increases of only 13%, and North Dakota actually saw prices fall 6%.
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