Maryland Residents to Pay $1.6 Billion More in Power Bills Due to Out-of-State Data Centers: Complaint

A top state utilities regulator is calling foul on an effort to shift the power cost of out-of-state artificial intelligence data centers onto Maryland residents.

Maryland's Office of People's Counsel on Thursday filed a complaint with the Federal Energy Regulatory Commission (FERC) against electric grid operator PJM Interconnection objecting to plans that it said would force residents in the state to pay $1.6 billion in data center-driven transmission costs over the next decade.

The complaint states that the transmission cost allocation methodology PJM is using "broadly socializes" the cost of increased power demands that is being driven by AI data centers.

"That result is unjust and unreasonable and violates the cost causation principles that have long governed transmission cost allocation and that this commission has repeatedly affirmed," the complaint says. "PJM’s tariff imposes these costs on Maryland electric customers even though Maryland customers do not meaningfully cause nor benefit from those investments."

The Office of People's Counsel pointed to the massive number of data centers built in neighboring Virginia as a primary culprit for added strain on the electric grid.

"Amidst national data center growth, Virginia stands as the epicenter," the complaint says. "Virginia is the largest data center market in the world... As of December 2024, data centers represented 3.6 GW of demand... reflecting, since 2013, a 660% increase in megawatt-hour consumption."

This explosive growth in energy demand is only expected to intensify over the next several years, the complaint continues, noting that "PJM projects 32 GW of peak load growth across its territory by 2030, of which approximately 30 GW is attributable to data centers."

As a remedy, the complaint asks FERC to "require PJM to take immediate action to assign data center-driven transmission costs to the PJM zones where the data center customers are located" instead of shifting the cost to Marylanders.

Commenting on his office's complaint, Maryland People’s Counsel David S. Lapp said that the attempt to saddle Maryland consumers with a $1.6 billion bill for facilities outside the state's borders shows "PJM’s cost allocation rules are broken."

"Maryland customers have neither caused the need for these billions in new transmission projects," Lapp added, "nor will they meaningfully benefit from them."

Data centers have become political lightning rods in recent months, as residents from across the country object to their mass resource consumption, which is leading to a major spike in utilities bills, as well as the noise pollution they generate.

As CNBC reported earlier this year, PJM currently projects that it will be a 6 GW short of its reliability requirements in 2027 thanks to the added demand from data centers.

Sen. Bernie Sanders (I-Vt.) and Rep. Alexandria Ocasio-Cortez (D-NY) earlier this year introduced a bill that would impose a nationwide moratorium on AI data center construction “until strong national safeguards are in place to protect workers, consumers, and communities, defend privacy and civil rights, and ensure these technologies do not harm our environment.”