AI Data Centers: Big Tech's Impact on Electric Bills, Water, and More

John Steinbach was shocked to receive a $281 electricity bill in January 2026—a huge spike from the roughly $100 he'd paid the previous month. "It's just so far beyond any bill that I've ever had," he says. Steinbach, who has lived in his Manassas, Va., home for nearly 40 years, worries his rates will keep climbing as the outsized electricity demand from AI data centers grows. "They're building them like it's 'Field of Dreams'—build it and the electricity will come—but we don't see how that's going to happen."

The contribution of AI data centers to higher bills is just one of the ways the development boom is affecting consumers. The facilities also compete for critical resources like water and land, and they can lower air quality and increase traffic, often while benefiting from changes to zoning laws and huge tax breaks.

A Boom Unlike Any Before

Data centers are not new. Such buildings have been around for decades, housing the servers and other hardware needed to power the internet. But since the introduction of ChatGPT to the public in late 2022, generative artificial intelligence has exploded, requiring mountains of new, power-hungry equipment.

To meet this ballooning demand, tech giants like Amazon, Google, Meta, and Microsoft have been investing billions to build immense new facilities packed with servers. Known as hyperscale data centers, they are far bigger than earlier versions, and are often built in sprawling industrial parks. Meta alone has dozens of these mega facilities in various stages of development, including its Hyperion campus in rural Louisiana—originally planned for 2,250 acres, the site recently expanded to 3,650 acres, the size of 2,765 football fields.

3,069 data centers already operate in the U.S., with an additional 1,489 planned or under construction.

Electricity Bills Are Rising

Residential electricity prices jumped 7.1 percent in 2025—more than double the inflation rate—and topped 20 percent in some states. A January 2026 report by Bloom Energy predicts that U.S. data centers' total combined energy demand will nearly double between 2025 and 2028, jumping from 80 to 150 gigawatts. That's like adding a country with the energy needs of Spain in just three years.

A typical hyperscale data center might use 100 megawatts—as much electricity as 100,000 households. Meta's Hyperion project in Louisiana will need at least 5 GW to run—three times as much electricity as the entire city of New Orleans. By 2028, data centers could use 12 percent of all the electricity consumed in the U.S.

Areas with high concentrations of data centers saw electricity prices jump 267 percent over the past five years, according to Bloomberg. Nearly three-quarters of Virginia voters blame the facilities for rising electricity costs.

Water: A Hidden Crisis

Water is another critical resource that data centers use in abundance—for cooling servers, which generate enormous amounts of heat. A typical large data center can use millions of gallons of water daily.

In some communities, this is already causing problems. Residents near data centers in dry regions have raised alarms about competition with agriculture and municipal supplies. "The cloud" turns out to need very real, very physical water to keep running.

Land, Air Quality, and Community Impact

The sheer physical footprint of hyperscale campuses displaces farmland, forests, and communities. Traffic from construction and operations degrades local roads. Diesel generators used for backup power can worsen local air quality, raising health concerns for nearby residents—often in lower-income communities with less political power to resist.

"People are starting to be really, really aware that these projects tend to be very extractive and bring very little to local communities," says Kasia Tarczynska, senior research analyst for Good Jobs First. "And that's where there's a huge pushback across the country."

Tax Breaks and Accountability Gaps

Despite their enormous resource consumption, many data centers benefit from significant tax incentives—property tax abatements, sales tax exemptions on equipment, and other subsidies—that shift costs onto local communities. Critics argue these deals are rarely subject to meaningful public scrutiny or enforceable accountability measures.

Consumer Reports is urging the industry to back up its pledges with detailed contracts and progress reports that can be monitored by the public. "This is ultimately about trust. Companies need to show—clearly and verifiably—that they're paying their own way, not driving up everyone else's electricity bills or harming the environment," says Chris Harto, CR's manager for sustainability advocacy.

As new, and ever-larger, AI data centers continue to spring up across America, communities are pushing back—demanding transparency, fair cost-sharing, and a real accounting of who bears the burden of the AI boom.