[Madison, WI] – The Wisconsin Data Center Coalition (WIDCC) is sharing a new comprehensive study from Charles River Associates (CRA) that clarifies the relationship between data center development and electricity rates. The report, Retail Rate Trends in the US, finds that common narratives suggesting data centers are causing broad energy price increases are inaccurate. Instead, the study reveals that recent rate changes are driven by specific, localized factors in other regions of the country.
“This study provides a factual foundation to address concerns about data center growth in Wisconsin,” said Tricia Braun, Executive Director for WIDCC. “When you look at the actual data, it becomes clear that the price increases seen in some parts of the country are not happening here. Wisconsin remains a stable environment for both energy consumers and technology growth.”
Understanding the Drivers of Energy Costs
The CRA study, commissioned by the Edison Electric Institute (EEI), analyzed residential electricity rates across the United States to identify what is actually moving the needle on prices.
- Localized Factors: Significant rate increases are largely concentrated in the Northeast and California. In the Northeast, increases are tied to higher wholesale electricity market prices. In California, costs are driven by wildfire mitigation and insurance.
- Market Structure Matters: The 800% capacity price increase often cited in national discussions is specific to the PJM region in the Mid-Atlantic. This affects utilities that do not own their own generation and must buy power on the open market.
- The Wisconsin Context: Wisconsin operates within the MISO (Midcontinent Independent System Operator) region, which has not seen these drastic increases. Most states in the MISO footprint are seeing rate changes that are lower than the national average.
- Timeline Analysis: The report notes that the timing and location of regional rate hikes do not match the patterns of data center development, making it unlikely that data centers are the cause of those increases.
Protections for Wisconsin Ratepayers
The report further explains that new “large load” tariffs and agreements are being used across the country to protect existing customers. These frameworks require data centers to fund the specific infrastructure needed to serve them, such as system upgrades and new generation.
“The idea that data centers must lead to higher bills for Wisconsin families is a fallacy that the data simply does not support,” added Braun. “By bringing in large users who pay for their own infrastructure and contribute to shared system costs, we can actually help maintain a more stable and affordable grid for everyone.”
WIDCC is working to share these findings with policymakers and stakeholders to ensure that discussions regarding Wisconsin’s digital infrastructure remain grounded in the latest economic data.
About the Wisconsin Data Center Coalition (WIDCC): The WIDCC is a collaborative organization focused on supporting the data center industry in Wisconsin through education and advocacy for stable energy policies and economic growth. Learn more: https://widcc.com/
