U.S. investor-owned utilities plan to spend at least $1.4 trillion on capital projects through 2030, a more than 21% increase from five-year projections outlined last year, nonprofit group PowerLines said in a report released on Tuesday.
The report, based on the analysis of 51 listed utility companies’ latest earnings calls, indicates that these increasing expenditures could lead to future requests for rate increases.
AI, Data Centers Drive Utility Costs
The primary drivers for this spending growth are the boom in AI power and the construction of data centers. However, other factors such as aging infrastructure, climate change, increasing electrification, and population growth have contributed to a 40% increase in utility bills since 2021, “with no signs of slowing down,” as per PowerLines. In 2025 alone, utilities sought $31 billion in rate hikes, stated the report.
Previously, Goldman Sachs projected global data center electricity use would rise 175% by 2030 from 2023 levels, revised up from 165%. U.S. electricity demand is projected to grow 2.6% annually through 2030, driven by data centers, marking a sharp acceleration compared to historical growth of under 2%.
PowerLines also pointed out that nearly half of all new spending is allocated for transmission and distribution, with another 30% directed towards new power generation.
“Investor-owned utilities are signaling a record-breaking wave of capital spending, and history shows that those plans are often a leading indicator of future utility rate increase requests,” said Charles Hua, Founder and …
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