Have Data Centers Raised Your Electric Bill? Causal Evidence from the United States
2026/06/18 by Asa Watten, John Bistline, Geoffrey Blanford · 5 voices
#physics.soc-ph #econ.GN
paper · pdf
Abstract
We estimate that data centers caused average retail electricity rates to fall modestly in the United States from 2015 to 2024 using an instrumental variables approach. Despite prevailing sentiment, the finding is consistent with economic reasoning: existing large power system fixed costs, economies of scale in transmission and distribution, and declining unit costs for generation imply that durable demand growth lowers average prices. We find patterns of economies of scale for transmission, distribution, and generation costs as well as within and across retail customer classes. We caution that future supply constraints could reverse the effect.
Citations
Discussions
- Boom. "We estimate that data centers caused average retail electricity rates to fall modestly in the United States from 2015 to 2024" arxiv.org/abs/2606.19777 [bsky, 35 points, 8 comments]
- Have Data Centers Raised Your Electric Bill? Causal Evidence from the US [hn, 4 points, 1 comments]
- 🚨New preprint with @bistline.bsky.social and Geoff Blanford where we estimate the *causal* effect of data centers on avg residential electricity prices. DCs probably didn't increase your elc bill in [bsky, 3 points, 1 comments]
- The optimistic read is that this can apply to electrification, too. Electric vehicles and heat pumps need not raise bills (and may lower them) while cutting emissions. Comments very welcome on the pre [bsky, 2 points, 0 comments]
- Have Data Centers Raised Your Electric Bill? Causal Evidence from the United States arxiv.org/abs/2606.19777… (actually, no) #AI #DataCenters [bsky, 1 points, 0 comments]
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