13 states facing steep electric bill increases

Millions of U.S. households across parts of the Midwest and East Coast are set to face higher electric bills, with the steepest increases in states where large data center operations are driving unprecedented power demand. Knewz.com has learned that the rise came after the PJM Interconnection, the country’s largest regional power grid operator, reported a 22% spike in wholesale capacity prices during its latest annual auction.

The states where electricity bills will climb the most

Virginia stands out as the most heavily impacted state. Loudoun County, known as “Data Center Alley,” hosts the world’s largest concentration of data centers, consuming vast amounts of electricity year-round. This high demand is pushing wholesale capacity prices upward for the entire PJM system, according to reports. Ohio is another state bracing for notable increases, particularly around Columbus, where rapid data center construction is reshaping local energy needs. Pennsylvania and Maryland are also expected to see significant jumps due to their proximity to major demand clusters and reliance on PJM’s shared capacity market. States like New Jersey, Delaware and West Virginia, though not major data center hubs themselves, will still experience higher costs because they are tied into the same interconnected grid. PJM’s territory covers 67 million people in 13 states and Washington, D.C., and includes several fast-growing data center hubs. The grid operator warned that customers could see electricity bills rise by as much as 5% in 2025.

Rising burden on households and small businesses

Consumer advocates are raising concerns about who bears the cost of this infrastructure expansion. In Maryland, People’s Counsel David Lapp has urged regulators to act. “We are witnessing a massive transfer of wealth from residential utility customers to large corporations—data centers and large utilities and their corporate parents, which profit from building additional energy infrastructure,” Lapp said. “Utility regulation is failing to protect residential customers, contributing to an energy affordability crisis,” he added. According to the U.S. Energy Information Administration, electric bills are already rising faster than inflation. A 5% increase in states like Virginia, Maryland, Ohio and Pennsylvania could mean households paying several hundred dollars more per year at a time when other living costs remain elevated.

How the PJM auction affects electricity bills

PJM runs an annual “capacity auction” to secure commitments from power generators for the following year. The price set in this auction determines how much utilities pay for the right to draw electricity when demand peaks, and those costs are ultimately passed on to customers. This year’s auction saw capacity prices rise 22% compared to 2024, which itself had been a record year. While PJM’s reach does not cover the entire United States, the auction serves as a bellwether for energy costs nationwide.

Energy and electricity costs continue to rise

During his 2024 presidential campaign, President Donald Trump made several promises to cut energy costs for Americans. In an opinion piece published on Newsweek in October 2024, the then-presidential challenger wrote, “We will cut energy and electricity prices in half within 12 months — not just for businesses but for all Americans and their families, and we will quickly double our electricity capacity, which we need to do to compete with China and other countries on Artificial Intelligence. With the lowest energy prices on earth, we will attract energy-hungry industries from all over the planet and millions of blue-collar jobs.” Trump had also blamed former President Joe Biden for contributing to energy price hikes. However, according to data from the U.S. Bureau of Labor Statistics, the average price of electricity per kilowatt-hour has risen by 6%, from $0.179 in January to $0.190 in June.

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