Ohioans are facing increasing power bills, with further hikes expected as utility companies make significant grid investments based on projected electricity demand from a boom in data center development across the state. Critics are questioning the accuracy of these forecasts, arguing that consumers may bear the cost for infrastructure built for projects that might never fully materialize.
Ohio has become a prime location for data center developers, with approximately 100 facilities currently operating and nearly 150 more planned. However, many of these planned facilities may not be built, yet their anticipated electricity needs are already impacting energy bills for Ohio residents, according to information originally published by Canary Media.
Utility companies base their grid investments on demand projections. American Electric Power’s Ohio Power Co., the state’s largest regulated electric utility, forecasts that demand will nearly triple over the next decade, a rise attributed largely to expected data center projects. Jonathan Koomey, a researcher with Koomey Analytics who focuses on data centers, computing, and climate solutions, noted that utility forecasts often assume past trends will continue. However, Koomey stated there is “deep uncertainty” regarding future energy consumption, citing factors like increasing computing efficiency, the uncertain demand for AI services, and developers often exploring multiple locations for projects.
Brad Belden, board chair of the Ohio Manufacturers’ Association Energy Group, voiced concerns at his organization’s annual energy conference on August 27. Belden observed that projected demand has become “justification for enormous spending, record capacity costs, and increasingly urgent claims about grid reliability.” He emphasized that “‘Reliability’ cannot become the magic word that ends every conversation about cost.”
These data center forecasts influence electricity costs in two primary ways: by increasing capacity prices and by prompting utilities to construct new power lines. Capacity prices, which compensate power plant operators for their availability to meet peak demand, have surged more than tenfold in PJM Interconnection territory since May 2025. PJM, the regional grid operator serving Ohio and parts of a dozen other states, anticipates a substantial increase in demand from data centers, for which it currently lacks sufficient generation.
PJM Interconnection, which oversees generation and transmission procurement, has not been swayed by those challenging the extent of future energy needs. Asim Haque, PJM’s executive vice president for government and member services, called the Ohio Manufacturers’ Association’s assertion that load growth is not real “both naive and irresponsible.”
Meeting the projected demand, which analysts like Koomey suggest may be inflated, will likely lead to a significant increase in fossil-fueled electricity. Dennis Wamsted, an energy analyst for the Institute for Energy Economics and Financial Analysis, reported that added generation from fossil-fueled plants in the region between 2025 and 2027 is expected to be 2.5 times the additional electricity supplied by solar and wind. Critics have also pointed out that PJM and Ohio have made it difficult to build inexpensive solar, wind, and battery projects in recent years, which could have mitigated rising costs and future capacity issues.
Utilities’ and the grid operator’s projections also drive plans for expanded infrastructure, with investments mapped out based on anticipated future customer needs. John Seryak, CEO and founder of energy consulting firm RunnerStone, warned that if these data centers do not materialize, customers will ultimately bear the costs.
While large-scale transmission projects are federally regulated, lower-level “supplemental” transmission projects are managed by the states, according to PJM’s Haque. These projects, which can amount to billions of dollars, are deemed necessary for growing demand, including that from data centers needing grid connections or backup power. However, Maureen Willis, agency director for the Office of the Ohio Consumers’ Counsel (OCC), stated at the OMA conference that in Ohio, no independent body is examining the prudence or cost-effectiveness of these supplemental projects.
A 2025 Ohio law mandates that utilities and state regulators consider grid-enhancing technologies as a more cost-effective alternative to traditional transmission projects, though its implementation and cost recovery mechanisms remain unclear. A new rule limiting the time allowed to question company witnesses on customer charges will further complicate challenges to these costs.
The OCC filed a complaint with the Federal Energy Regulatory Commission (FERC) in 2023, seeking scrutiny of supplemental transmission costs. The agency has not yet acted, prompting the OCC to request an expedited review last month. Willis noted that the OCC’s consumer-protection complaint has been “collecting dust at FERC for nearly three years while billions more in transmission projects continue to be added,” asserting that consumers deserve answers, accountability, and protection from “unjustified costs.”
AEP Ohio’s largest projected overall demand growth is a tripling of current needs, Koomey noted at the OMA event. As of February, AEP Ohio’s load forecast reflected signed contracts for 17.8 gigawatts of data center demand slated to come online through 2035, a figure that was revised down from an earlier 2025 estimate. Despite this reduction, a March 2026 regulatory staff filing at the Public Utilities Commission of Ohio pointed to possible double-counting within AEP Ohio’s expected data center growth.
PJM released new guidance in January to modify its load forecasting process and add steps for states to review adjustments for large loads. Critics, however, believe these changes are insufficient. Belden of the Ohio Manufacturers’ Association Energy Group urged, “Show us the demand. Show us what is being built. Show us who is paying for it. And show us what happens if the forecast is wrong.” He called for the same discipline in grid investment as in any major business decision, arguing that new investment should strengthen Ohio’s economy rather than turn existing customers into an “insurance policy for projects that may never materialize.”
