Are data centers driving up electric bills?

Dear Editor,

After reading about rural communities around the country paying for the electricity that data centers use, I asked Google the question “Does ConEd supply electricity to data centers in Westchester County that increases costs to residents?”

The answer is yes. There are seven data centers in Westchester that potentially contribute to higher electricity costs for residents. The massive power demands of these facilities, particularly those catering to Artificial Intelligence (AI) and crypto-currency mining, create significant strain on the local power grid, which can lead to increased utility rates for households.

Westchester County does not have a fixed electricity price for its data centers. Large commercial facilities in the area negotiate individual utility agreements or participate in specialized power programs. Citizens are not told exactly at what rate the data centers are charged.

Data centers are power-hungry and often require significant infrastructure upgrades, such as new transmission lines and substations. Utilities like Con Edison can pass the costs of these upgrades onto customers, appearing as rate hikes on residential bills. As data centers demand more power, they drive up wholesale electricity prices. Areas near data centers have seen these costs increase by as much as 267% over the past five years. The power grid in New York moves energy from upstate down the Hudson Valley to New York City. Increased consumption and stress in Westchester can impact the price and reliability of power for residents throughout the area.

One of seven Westchester-based data centers is SS&C GlobeOp Data Center at 1565 Front St., in Yorktown Heights. Westchester homeowners already pay some of the highest electricity rates in the country. A typical Con Edison residential customer on the EL1 flat rate pays between $0.33 and $0.38 per kWh. NYSEG customers in Northern Westchester pay around $0.23 per kWh. These rates are not fixed. Con Edison files rate adjustment cases regularly, and infrastructure upgrades required to handle increased grid load are recovered through these rate cases.

While data centers can provide some economic benefits (potential tax revenue), the immediate impact on residential energy bills is often negative, particularly when the grid requires expensive upgrades to meet the surge in demand.

Westchester residents can file complaints about data center energy consumption through the NYS Department of Public Service, the Westchester County Consumer Protection Board, and the New York State Attorney General.

I’m not necessarily against data centers. I just want them to pay their fair share for electricity and that what they are charged is not kept from us!

Michael Angley, Yorktown Heights