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Grid upgrades would have to happen no matter what. Data centers are just the catalyst and boogeyman at the moment.
This utopia that everyone has about electric cars will never come to fruition without grid upgrades.
This country has systematically underinvested and underdeveloped the electric grid for 50 years and now we are paying the price. It is a government failing.
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The real question is "why do rates go up with a data center?"
That answer is interesting. Its cause in most states, if a company formally requests a power hookup, the power company MUST comply. Thus entails in upgrading substations, transformers, supply lines, etc. And all those upgrades are borne by the citizens in that region.
That's why you bill goes up, cause datacenter upgrades dump on the public their externalities.
In some states like Indiana, the governor is already talking about changing that law requiring data centers to pay for upgrades.