Customers could end up paying for data centers’ energy costs in the absence of reform: Experts

Published

6 months ago

April 16, 2025

admin

A visitor observes a computer bay at the PA10 data center, operated by Equinix Inc., in Paris, France, on Thursday, Feb. 6, 2025.

Bloomberg | Bloomberg | Getty Images

In some advanced economies, electricity infrastructure and cost of utilities are undergoing structural changes because of artificial intelligence-driven demand for data centers.

In the process, U.S consumers could be paying higher utility bills because of the sector shifting costs to consumers, warned a latest paper by the Harvard Electricity Law Initiative.

Meanwhile in the U.K, residents may experience higher wholesale prices in light of a proposed reform to the electricity market that would favor data centers which harness renewable energy.

As pricing concerns emerge, regulation and energy grid reform will take center stage in managing energy prices and meeting changing energy needs.

‘Complex’ special contracts

Special contracts between utilities and data center companies are one of the ways higher costs associated with data centers may transfer onto everyday consumers, identified a report by the Harvard Electricity Law Initiative in March.

Such contracts “allow an individual consumer to take service under conditions and terms not otherwise available to anyone else.” In other words, they can be used to shift costs from data centers to consumers because of the subjectivity and complexity in those contracts’ accounting practices, the report stated.

Moreover, special contracts are approved by the Public Utilities Commission but tend to undergo “opaque regulatory processes” that make it difficult to assess if costs have been shifted from data centers onto the consumer.

To remedy this, the report recommended regulators tighten oversight over special contracts or completely do away with them and opt for existing tariff practices.

“Unlike a one-off special contract that provides each data center with unique terms and conditions, a tariff ensures that all data centers pay under the same terms and that the impact of new customers is addressed by considering the full picture of the utility’s costs and revenue,” according to the report.

Jonathan Koomey, a researcher in energy and information technology, concurs with the need for data centers to pay according to their usage of the energy grid.

“The key point, in my view, is that highly profitable companies who impose costs on the grid with big new loads should pay the costs created by those new loads,” Koomey told CNBC.

Beyond utility companies and regulators, “intervenors in the utility regulatory process also play a critical role,” Koomey said.

Intervenors can include a specific group of constituents or a large commercial or industrial customer who partake in proceedings. They may raise issues pertaining to customer service and affordability and ultimately allow for commissions to hear from a broad group of stakeholders.

“They often can dig deeper than the overburdened regulators into the projections and technical details and reveal key issues that haven’t yet surfaced in regulatory proceedings,” Koomey added.

Overbuilt infrastructure?

Another factor affecting utility prices is the excessive development of energy infrastructure.

Utilities and pipeline companies in the states of Virginia, North Carolina, South Carolina and Georgia are planning a “major buildout of natural gas infrastructure over the next 15 years,” potentially based on an overestimation of data center load forecasts, highlighted a report by the Institute for Energy Economics and Financial Analysis in January.

Proactive decisions on the part of utilities and regulators are needed to prevent ratepayers from being “on the hook” for overbuilt infrastructure, said the IEEFA report.

Policymakers across states have adopted a slew of measures to incentivize, curb and regulate the influx of data center development, from tax breaks to legislative bills, with a focus on ensuring non-data centers consumers do not bear undue costs, according to a report by the Gibson Dunn Data Centers and Digital Infrastructure Practice Group.

Zonal pricing

In the U.K, data centers and consumers face a different pricing challenge amid government plans to transform the country’s electricity market into a decarbonized, cost-effective and secure electricity system.

The zonal pricing scheme that is being explored under the government’s Review of Electricity Markets Arrangements would mark a shift away from uniform pricing to a split electricity market. Under the new framework, consumers in different geographical zones would be subject to different wholesale electricity prices based on the marginal cost of meeting demand at that location.

Modeling from consulting firm Lane Clark and Peacock suggests that Northern Scotland would experience lower wholesale prices owing to their high renewable penetration and relatively low demand.

The rest of the U.K, accounting for 97% of national electricity demand, is poised to see a rise in wholesale prices from the current national pricing model.

The impact on retail prices remains murky as yet.

“It is not clear how this may impact retail prices as wholesale prices are only one part of the overall electricity bill for consumers, and DESNZ still needs to make various decisions,” according to joint comments from Sam Hollister, Head of Energy Economics, Policy, and Investment and Dina Darshini, Head of Commercial and Industrial at Lane Clark Peacock’s energy transition division, LCP Delta.

The DESNZ is the U.K.’s Department for Energy Security and Net Zero.

Will data centers benefit?

While tech firms appear onboard with the lower costs that zonal pricing stands to offer, based on think tank research supported by Amazon, OpenAI and Anthropic, whether data centers do in fact stand to benefit from zonal pricing would depend on their type of operations, according to Hollister and Darshini.

Those potentially well-suited for zonal pricing include data center facilities that handle workloads that can be shifted in time or location, they said.

AI training for deep learning models is one such example. Such workloads can be scheduled during off-peak hours when electricity prices may be lower and synchronized with periods of surplus wind or solar power, which would reduce costs and alleviate grid congestion.

Similarly, data centers that do not need to be close to major urban centers or end users — such as those supporting hyperscale AI training, cloud and large-scale data storage facilities or scientific computing hubs — could also benefit from cheaper electricity when located in regions with high renewable generation and low local demand, Hollister and Darshini said.

However, “not all AI workloads are flexible — real-time inference tasks, such as those used in chatbots, fraud detection, or autonomous vehicles, require immediate processing and would not benefit from time-shifting,” they added.

Latency-sensitive applications such as financial trading and real-time streaming that require close proximity to users would also find zonal pricing “less viable.”

Boosting grid infrastructure

Proponents of zonal pricing point to the benefits of reducing the need to move energy over long distances.

But with the National Energy System Operator’s plans to increase network capability and connect more offshore wind, focusing on grid infrastructure is important, “and zonal pricing won’t eliminate those requirements,” according to Hollister and Darshini.

“It’s not just data centers that are going to need this additional capacity on the grid, they’re probably the most high profile ones, but EV charging is going to change the grid. National Grid as an organization have been talking about the change in the demand profile from EVs for a very long time,” David Mytton, a researcher in sustainable computing, told CNBC.

The demands on the energy grid posed by the electrification of vehicles is a challenge shared across the U.S. and U.K.

In the U.S., electric vehicles will constitute over half of all new cars sold by 2030 and is set to place a considerable strain on an aging energy grid system.

While the electricity consumption of U.S. data centers is growing at an increasing pace, a report by the Lawrence Berkeley National Laboratory published in December noted that this is playing out against a “much larger electricity demand that is expected to occur over the next few decades from a combination of electric vehicle adoption, onshoring of manufacturing, hydrogen utilization, and the electrification of industry and buildings.”

Given this, the infrastructural and regulatory reforms that emerge out of data center management would be helpful for an imminent era of changing electricity demand, said Mytton and fellow researchers.

Environment

US average new car price tops $50k for the first time – here’s why

Published

4 hours ago

October 13, 2025

admin

US average new car price tops k for the first time – here's why

The average US new car price crossed the $50,000 mark for the first time in September, according to new estimates from Kelley Blue Book (KBB). Prices have been climbing steadily for over a year, and the pace picked up this summer – but that hasn’t stopped Americans from buying.

KBB says September’s record average transaction price (ATP) was partly driven by luxury models and EVs, which pushed the market into record territory. EVs made up an estimated 11.6% of all new vehicles sold last month, which is also a record high. The average EV sold for $58,124 – up 3.5% from August’s adjusted figure.

In Q3, EV sales hit another milestone: 437,487 EVs were sold in the US, giving them a 10.5% market share. That’s nearly a 30% jump from the same period last year. With government-backed EV incentives expiring at the end of September, many buyers hurried to lock in their purchases.

Year-over-year, the average EV transaction price is basically flat, down just 0.4%. Incentives averaged 15.3% of ATP in September, or about $8,900 per vehicle – slightly lower than August but higher than a year ago, when incentives averaged 13%.

Advertisement – scroll for more content

Tesla, which continues to dominate the EV market, saw an average ATP of $54,138 in September. That’s a slight dip from August and down 6.8% from a year earlier. With Tesla recently introducing the new Standard versions of the Model 3 and Model Y, KBB expects average prices across the segment to fall in the coming months. Erin Keating, executive analyst at Cox Automotive, thinks the market is “ripe for disruption.”

“It is important to remember that the new-vehicle market is inflationary. Prices go up over time, and today’s market is certainly reminding us of that,” said Keating. “The $20,000 vehicle is now mostly extinct, and many price-conscious buyers are sidelined or cruising in the used-vehicle market. Tariffs have introduced new cost pressure to the business, but the pricing story in September was mostly driven by the healthy mix of EVs and higher-end vehicles pushing the new-vehicle ATP into uncharted territory.”

The 30% federal solar tax credit is ending this year. If you’ve ever considered going solar, now’s the time to act. To make sure you find a trusted, reliable solar installer near you that offers competitive pricing, check out EnergySage, a free service that makes it easy for you to go solar. It has hundreds of pre-vetted solar installers competing for your business, ensuring you get high-quality solutions and save 20-30% compared to going it alone. Plus, it’s free to use, and you won’t get sales calls until you select an installer and share your phone number with them.

Your personalized solar quotes are easy to compare online and you’ll get access to unbiased Energy Advisors to help you every step of the way. Get started here.

Add Electrek as a preferred source on Google

FTC: We use income earning auto affiliate links. More.

Environment

Genesis is about to launch two new ‘electrified’ SUVs based on the GV70

Published

5 hours ago

October 13, 2025

admin

Genesis is about to launch two new 'electrified' SUVs based on the GV70

It’s official. The Genesis GV70 is about to get two new electrified options, including its first hybrid and extended-range (EREV) versions.

Two new Genesis GV70 electrified SUVs are coming soon

Genesis is turning 10, and it’s planning to go all out. Hyundai gave us a look at what’s coming last month during its CEO Investor Day.

The plans include Genesis expanding with new electrified powertrain offerings, including its first hybrid and extended-range electric vehicles.

Up until now, the luxury automaker has focused on fully electric (EV) or internal combustion engine (ICE) vehicles. By expanding into different electrified powertrains, Genesis hopes to attract new buyers to the brand while grabbing a bigger share of the luxury market.

Advertisement – scroll for more content

Genesis will launch its first hybrid in 2026, the GV80. We knew the GV70 EREV would follow shortly after, but now it’s been confirmed that a hybrid model is also set to join the lineup.

We got our first look at the Genesis GV70 EREV last week. The vehicle was parked in South Korea and appeared to be nearly identical to the current model. Aside from a tag labeling it an EREV and a massive muffler at the back, it looks about the same as the Electrified GV70.

[embedded content]

Now, we are finally getting a glimpse of the Hybrid version. The Genesis GV70 Hybrid was also caught by HealerTV in South Korea, this time with an HEV tag.

Like the EREV, the GV70 Hybrid is still covered in camouflage, but this time, you can see the vehicle has the brand’s sport package. The optional package adds sporty exterior and interior elements, including chrome around the Crest Grille and window trim.

The vehicle is still a prototype, so it could change by the time it reaches production form. However, as the reporter points out, the GV70 Hybrid could bring a unique new look to the GV70 series.

On the side of the tire, the letters “FL” are printed, which is typically shown on Hyundai vehicles set to receive a facelift.

Genesis is expected to launch the GV70 EREV in late 2026, followed by the Hybrid version sometime in early 2027.

According to Hyundai, the EREV will have a combined driving range of over 1,000 km (620 miles). Although it still runs on an electric motor, it will feature a small gas motor that acts as a generator to charge the battery and extend the driving range.

Genesis is betting on new electrified vehicles, including EVs, hybrids, and EREVs, to drive growth. The luxury brand aims to expand into up to 20 new European markets while gaining a bigger share of the US market. By 2030, Genesis aims to sell 350,000 vehicles.

Although it had planned to only offer fully electric vehicles from 2030, Genesis backed off on its commitment. Instead, it will use hybrids and EREVs as a bridge to an all-electric future.

FTC: We use income earning auto affiliate links. More.

Environment

Duracell’s first-ever EV fast charger network will be in the UK

Published

7 hours ago

October 13, 2025

admin

Duracell's first-ever EV fast charger network will be in the UK

Duracell EV fast charging — Photo: Duracell

Duracell, the iconic US battery brand that started in the 1920s, is crossing the Atlantic to launch its first-ever EV fast charging network, Duracell E-Charge, in the UK.

Sales of gas and diesel cars will end by 2030 in the UK, which is driving EV sales and charging infrastructure growth. With more than £200 million ($266 million) in planned investment over the next decade, Duracell E-Charge is getting on the bandwagon with an aim to improve the fast charging experience.

Duracell has licensed its new network to Elektra Charge, a charge point operator set up to run the Duracell E-Charge network. The EV Network (EVN), one of the UK’s top charging infrastructure developers, will fund and build the charging hubs.

“The need for faster, more reliable charging to keep pace with EV adoption is clear,” said Reza Shaybani, CEO of The EV Network. “Duracell E-Charge is a direct response to that challenge.”

Advertisement – scroll for more content

Duracell’s EV fast charging network will feature 400 kW ultra-fast chargers where drivers can pay via app, contactless, or plug-and-go. Each site will have intuitive interfaces, clear signage, and 24/7 support.

The first six Duracell E-Charge sites will come online in 2025. The Sunday Times reported that Duracell plans to grow its charging network to at least 100 charging stations with at least 500 charging points by 2030. The hubs will be strategically located along major motorways, near retail and hospitality venues, and at key city gateways.

“Charging your car should be as simple as changing the batteries in your remote,” said Mark Bloxham, managing director of Duracell E-Charge. “Plug. Play. Go.”

Electrek’s Take

I asked Duracell whether it had plans to launch Duracell E-Charge in the US, and I’ll update this story if I hear back. But if you want to know why this American legacy company launched its first DC fast charging network in the UK instead of the US, it’s a simple answer. Business-friendly, stable government policy.

Your personalized solar quotes are easy to compare online and you’ll get access to unbiased Energy Advisors to help you every step of the way. Get started here.

FTC: We use income earning auto affiliate links. More.