Comment by Aurornis
> 3. For those DCs connected to the local grid, dthey are essentially getting residential customers to pay for the infrastructure and to subsidize the energy usage
This is not the case for any well run utility. Commercial customers will pay their share and have their own rates.
Residential power rates are heavily regulated and require a lot of work and justification to raise.
The one case you’re citing appears to be some failure or perhaps corruption. It’s not a universal rule.
I don't know what to tell you other than this is well-established [1][2][3][4].
Also, what exactly is a "well run utility"? IMHO all utilities should be municipality or state owned. All privatization does is transfer wealth from the government and the not-wealthy to the already-wealthy. I suspect you might not agree however.
There are caps on how much utilities can charge but they're allowed to absorb capex (eg by building new transmission lines to a new DC) and if the utility has to buy electricity on the spot market because of increased demand (as was the case with crypto mining in upstate New York), then that raises the per-kWh cost of electricity for everyone, which is great in a cost-plus model.
We've seen this exact thing with healthcare insurance premiums. By law, a certain percentage of premiums has to be spent on giving care. Sounds good, right? So how do you, as an insurance company get around that? You push for higher premiums because that same percentage of profit now means more money. And how do you increase healthcare spend to keep that percentage intact? By spending with providers you also own.
[1]: https://www.bloomberg.com/graphics/2025-ai-data-centers-elec...
[2]: https://energyathaas.wordpress.com/2025/09/29/what-will-data...
[3]: https://www.techpolicy.press/how-your-utility-bills-are-subs...
[4]: https://substack.perfectunion.us/p/how-data-centers-are-driv...