Design Highlights
- The Georgia PSC approved a $16.3 billion power buildout primarily to support data centers, particularly hyperscale ones.
- Approximately 80% of the new capacity is dedicated to data center energy consumption, raising concerns about residential cost burdens.
- The PSC claims residential customers could save $102 annually, but opponents warn total costs may escalate to $50-$60 billion.
- Consumer advocates express skepticism about actual demand from data centers and the potential financial liability for residential customers if demand falls short.
- Ongoing PSC oversight on large customer contracts aims to prevent unfair cost shifts onto residential consumers amid demand uncertainties.
Georgia regulators just gave a big thumbs-up to a massive power buildout aimed squarely at data centers. The Georgia Public Service Commission (PSC) approved a staggering 9,900 megawatts of new capacity for Georgia Power. That’s about 10 gigawatts. The nod was unanimous—5-0.
After months of deliberation, they finally greenlit a project that’s set to cost around $16.3 billion. Yes, billion with a ‘B.’ This entire endeavor is being pitched as a way to power the ever-growing demand from data centers, especially those hyperscale ones that munch on electricity like candy.
So, what’s in the mix? The approved resources include combined-cycle natural gas, battery energy storage systems, solar-plus-storage, and a bunch of power purchase agreements. Sounds fancy, right? But here’s the kicker: about 80% of this shiny new capacity is aimed at feeding the insatiable appetite of data centers.
About 80% of the new power capacity is set to satisfy the relentless energy demands of data centers.
Georgia Power claims that the increase in demand is fueled by AI compute and the explosive growth of these digital behemoths. The utility estimates this capacity could power around 4 million homes. That’s a lot of light bulbs. Additionally, the new power plant facilities are expected to generate this additional capacity within five years. Georgia Power anticipates that this increase will cater to an anticipated 10,000 megawatts needed for future growth.
Now, let’s talk about the money. The PSC insists that the buildout will lead to savings for customers—about $102 a year for a typical residential customer.
But hold on. Opponents are waving red flags, projecting that total payments from customers over the coming decades could soar to between $50 billion and $60 billion. That’s right. And who gets stuck with that bill? You guessed it. The average Joe at home.
In a bid to protect ratepayers, the commission is now requiring that any new large customer contracts—those over 100 megawatts—must get a thumbs-up from the PSC. They don’t want any sneaky business that shifts costs unfairly.
Still, consumer advocates are skeptical. They worry that if the demand from data centers doesn’t materialize as expected, residential customers might end up footing the bill. Data centers themselves face growing exposure to financial losses from cyber breaches and operational interruptions, risks that specialized insurance coverage increasingly addresses.
To add an extra layer of complexity, the PSC is demanding that Georgia Power keep a close watch on demand. If things go south, they’ll need to renegotiate agreements.
Sounds like a plan, right? But what happens if the AI boom fizzles out? Supporters of the buildout argue that spreading the costs could ease the financial burden on existing customers.
But the risk remains palpable. If things don’t work out, it’s the little guy who may end up paying the price.
