June 3rd, 2026

By Rep. Shane Klakken, HD 37

Data Centers and Your Electric Bill: What the Numbers Really Show

Out here in central Montana, when the wind whips across the prairie and the ranch lights stay on after dark, folks keep a close eye on the electric meter. We run pumps for livestock, keep grain dry, heat homes through long winters, and power the equipment that feeds families across the country. So when headlines scream that power-hungry data centers are about to send our bills skyrocketing, it gets attention — especially with concerns voiced right here in Fergus County.

But a recent analysis from the Institute for Energy Research suggests we ought to look past the headlines and at the actual numbers. Their report, “Have Data Centers Driven Up Electricity Prices?” digs into state-by-state data from the U.S. Energy Information Administration. The conclusion? The story that data centers are the main culprit behind rising power costs doesn’t hold up when you check the facts.

Data centers have grown fast, no question. AI and cloud computing need serious electricity — U.S. data centers jumped from about 76 terawatt-hours in 2018 to around 176 by 2023. Big tech companies like Meta have seen their usage more than double in some cases. Here in Montana, NorthWestern Energy may have deals in the works that could bring major new demand. Local meetings have drawn crowds worried about water use, noise, and whether everyday Montanans will foot the bill for fancy server farms serving Netflix and Silicon Valley.

That worry makes sense on the surface. More demand should mean higher prices, right? But the IER looked closer. They compared states packed with data centers to those with fewer. Top data center states averaged about 14.46 cents per kilowatt-hour in recent data — almost exactly the same as the 14.39 cents in other states. No real statistical link between lots of data centers and higher bills.

What about price increases over time? Again, weak connection at best. From 2015 to 2025, states with heavy data center growth saw prices rise, but the difference wasn’t statistically meaningful. Same for more recent years.

Here’s the surprising part that ought to ring true for any farmer or small business owner who understands spreading costs: States where electricity sales grew the fastest actually saw the smallest price hikes. High-growth states had price increases around 20 percent, while low-growth or shrinking states jumped nearly 40 percent. Why? Power systems have huge fixed costs — plants, lines, maintenance. When more customers (or bigger ones) use the system, those costs get divided up. More volume can actually help hold rates down.

Look at examples. North Dakota, with strong energy growth, saw prices drop. California and some Northeast states with flat or falling demand saw big jumps. It lines up with what practical folks already know: You don’t punish growth; you manage it right.

In Montana, this matters. We’ve got reliable coal, hydro, and other resources. NorthWestern Energy talks about using new demand to make better use of assets like Colstrip. If structured properly — with data centers paying their full share for new infrastructure through separate tariffs — it could help keep the lights on without burdening ranches and homes. But that depends on smart oversight by the Public Service Commission, not blank checks to Big Tech.

Rural Montana has always been about common sense. We’ve seen policies from far-off places — heavy renewable mandates, regulations that chase reliable power — drive up costs in other states. The IER points to those policy choices as bigger drivers of price differences than any server farm. Montana shouldn’t repeat mistakes. We can welcome economic opportunity if it means good-paying jobs, tax base for our schools and roads, and rates that don’t squeeze family operations.

That doesn’t mean throwing caution to the wind. Water use, local impacts, and making sure existing customers aren’t subsidizing corporate giants deserve real scrutiny — exactly what folks in Lewistown have been asking at public meetings. Data centers should pay fair taxes and cover their grid upgrades. No special deals that leave the rest of us holding the bag.

The bigger picture is this: America needs more energy, not less. AI might be flashy, but so is keeping agriculture strong, manufacturing humming, and homes warm. Shutting down growth to protect today’s rates often backfires, leaving everyone with less reliable and more expensive power later.

As proposals move forward in Montana, let’s insist on data over narrative. Look at the actual state numbers instead of scary headlines. Demand growth, handled responsibly, can support affordable, reliable electricity — the kind hardworking Montanans have counted on for generations. Our kids’ future, our ranches, and our communities depend on getting this right.