Data centers need power – lower income, rural residents pay the price

Increased demand drives up prices under a fixed supply regime. Power is, in many places of the US, something approaching a fixed supply regime. This is not a physical requirement of the universe. It is a policy choice that we have made. I would argue that it is not the data centers driving up power prices, it is our policies around how difficult it is to provision new power (or build almost anything at all) in the US.

Congress could fix this problem tomorrow. And in fact there is a bipartisan bill (BAAJA) that would go a long ways (although not all the way) towards fixing it. Now yes even if we fix these policies there would be a time lag on new generation being connected, but there is no reason to leave this problem in place.

The authors shared a replication package with all of the data, which more researchers should do: https://zenodo.org/records/23019736

I find their methodology misleading, though. They're basically taking the cost of transmission infrastructure upgrades and then assigning the cost of those upgrades proportional to peak energy demand of the customer base, not the cost of the infrastructure upgrade.

So if, for example, they estimate that residential customer demand will grow by 10%, then they suggest residential customers should only be paying for 10% of transmission infrastructure upgrades.

That's not how infrastructure upgrades work, though. Connecting 100,000 new residential addresses and areas can cost more than a couple data centers that are close to the power station.

The problem is they don't have access to, or at least they didn't look very hard, to find the actual data about transmission line upgrades and how much data centers actually pay to get connected. Contrary to what I see in a lot of the comments here, big customers do actually get billed for their infrastructure upgrade costs after utilities do their analyses. This paper is ignoring the utilities' analyses and substitutes their own highly simplified proportional-to-peak-demand estimates, and that's how they get their headline number.

One very surprising discovery was that they show data center construction incentives to actually be a good deal:

> State incentives for data centers have provided returns on the investments, if inconsistently, the researchers found. Some states, such as California, reaped $180 in worker income for every dollar spent, while Virginia increased income $2 for every dollar invested. The researchers determined that the presence of an existing, qualified workforce was a stronger indicator of high returns than the amount of incentive spending.

That's not what I expected to read.

This is a topic where details basically don't matter for public opinion, though, so I'm not sure it matters. It aligns with what people

I struggle to understand why data centers are seen as a problem rather than an opportunity. Cities and counties can charge a high property tax to data centers and the residents can benefit. They might even give residents a dividend from the data center property tax. What's wrong with that plan?

Datacenters are this generation’s nuclear power plants. Our kids will look back and wonder what we were thinking.

It's important to remember that datacenter news is about the countries they're built in.

Not all buildings are built or powered the same way in all countries based on the weather of their location.

American lenses about American Datacenters will be about whats happening in America, not other places.

Yes, absolutely. What do local residents get out of the data centers?

I remember earlier this year somebody posted the results of a large survey that concluded most people would rather have a nuclear power plant in their backyard than a data center. Of course everybody would rather have nuclear power plant in their backyard because then they get cheap, clean, reliable electricity. They get nothing from the data center except competition for basic utilities.

I also remember how the person couldn't believe the results and found them astonishing. WTF. This just reinforced for me how so many people in technology are either narcissistic, short sighted (exceptionally naive), or have some sort of qualified mental health defect.

I love how America's first intuition when a booming technology/industry appears is to racketeer as much as possible until it dies. My favorite quote:

>California hasn't built its bullet train because the state has required 130,000 pages of environmental reports, making absurd demands like:

• counting bumblebees one by one • rebuilding woodrat stick huts • hiring specialized dogs to sniff lizard scat

I’m lucky enough (/s) to have a regulated, for-profit power company as the only option for electricity. They made $430M in profit this past year and are asking the corporation commission to raise our rates “only” 14% this year. Meanwhile, the cost of electricity they pay to purchase from residential solar is approaching zero.

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Here's an interesting coincidence. During 2010-2023, data centers growth was all in crypto farms, a truly ridiculous massive waste of energy. However, that growth played against the West. It diverted capital into ruinous tulip bubbles. It created an alternative to the Western-led financial system and trivialized bypassing sanctions. Yet it got fairly little mainstream coverage.

Now there's a tech race. Data centers are a necessary evil for the West to win it. And suddenly they're getting massive negative coverage. Just today I saw articles about both the far left and far right prioritizing the issue.