Americans May Have To Pay Much More For Electricity. Reason: Artificial Intelligence

Last Updated:July 17, 2025, 20:24 IST

A White House study warned AI and cloud computing could raise US electricity prices by 58% by 2030.

AI data centers may consume more power than heavy industries, needing $1.4 trillion investment.

A new White House study warned that the rapid rise in artificial intelligence (AI) and cloud computing could lead to sharp increases in electricity prices across the United States unless the country significantly boosts domestic energy output. The report, prepared by the White House Council of Economic Advisors, highlighted the growing pressure AI-powered data centers are placing on the nation’s already stretched power grid- warning that without major investments, the cost of electricity could increase by up to 58% by 2030.

“The rise in demand for AI and cloud computing capabilities is already driving up electricity use in the United States," the report stated, adding, “After two decades of growth below one percent per year, the demand for electricity grew by two percent in 2024."

AI Power Needs Could Outpace Heavy Industry

The report draws on data from the Energy Agency (IEA), which forecasts that by 2030, US data centers will consume more electricity than the entire domestic production of aluminum, steel, cement, chemicals and other energy-intensive goods combined.

“The Energy Agency (IEA) estimates that by 2030, US data centers will consume more electricity than production of aluminum, steel, cement, chemicals and all other energy-intensive goods combined," the report noted. This projected surge in energy use is being fueled by widespread AI adoption, which the council argues could also bring substantial economic benefits but only if infrastructure keeps pace.

“If half of US businesses engage in widespread use of AI by 2034, the annual productivity growth of labor could be 1.5 percentage points higher starting in 2034 than it would otherwise be," the report said, adding, “This boost in labor productivity could, in turn, increase GDP growth by 0.4 percent in 2034."

$1.4 Trillion Investment Needed by 2030

The report estimated that between 2025 and 2030, the US will need to invest approximately $1.4 trillion in new electricity generation capacity to meet rising demand from AI, industrial electrification and domestic manufacturing reshoring.

“Once higher demand from industrial electrification and reshoring of manufacturing is added in, the total increase in power demand would require an estimated $1.4 trillion of investment… more than the industry’s investment over the previous decade," the report said, warning, “Electricity prices in 2030 could be 9 to 58 percent higher as a result of higher demand for power if lower-cost providers don’t come online."

Washington D.C., United States of America (USA)

News world Americans May Have To Pay Much More For Electricity. Reason: Artificial Intelligence