While U.S. electricity consumption exhibited limited to no growth for most of the 21st century, it has been rising in recent years, largely due to data center load growth. These large, energy-intensive loads are the digital backbone of the expanding artificial intelligence (AI), cloud computing, and cryptocurrency industries. For municipal electric utilities, data centers represent a strong source of energy sales and revenue growth, as well as provide a considerable benefit to the local tax and economic base. However, depending on the size of the data center load relative to the available power supply, transmission access and capacity, and the utility’s existing customer base, the cost to serve data centers can be significant, presenting considerable challenges for public power. While this report is primarily focused on public power impacts, KBRA also notes credit implications for host municipal governments.
Key Takeaways
- After many years of lackluster growth, U.S. electricity…