In sum – what to know
AI power panic – South Carolina’s Santee Cooper hikes rates on mega users (50MW+), amid wider fears that surging AI energy demand could burden ordinary customers with 70% higher bills.
AI gold rush – Google, Meta, and others are pouring billions into South Carolina data centers, drawn by strategic location, fiber routes, and (until now) cheap, reliable power.
EVs add strain – battery and vehicle plants are joining the energy stampede, locally and globally – with up-to 150MW loads; state lawmakers now seek to cap tax breaks and protect residents.
So AI infrastructure is in the local paper. Well, of course – when the news story, reshaping the entire global economy, is taking root in your own backyard. It is being covered as well because it is interesting and important. And so: the South Carolina Daily Gazette has reported (April 25) that the board at local state-owned power company Santee Cooper has voted unanimously to charge higher-rates for power-hungry users, requiring 50 megawatts or more, to avoid passing costs to regular consumers. Recent studies reckon electricity bills could jump between 50 percent and 70 percent for consumers and small businesses because of surging energy demand from AI data centers.
The new ruling by Santee Cooper impacts data centers, clearly, but will also hit new manufacturing plants in the state, which has seen massive investment in power-hungry new electric vehicle (EV) facilities, notably. It is symptomatic of a wider panic in energy markets. US energy demand could outstrip supply within the next few years, says Bain & Company. Data centers could account for 44 percent of US load growth in the period to 2028, it says; meeting demand would require utilities to boost annual generation by up to 26 percent by 2028, and costs will trickle down in a flood to residential consumers, potentially – as above.
The panic about AI infrastructure is everywhere, and quickly crosses into major concerns about its environmental impact. A study about data center construction in the UK, for instance, warns that government plans to “increase public-controlled AI computing power twentyfold by 2030” could completely “derail” its net-zero commitments. Everyone has a view: a separate report in the UK, paid for by Amazon and OpenAI, says the government should split the electricity market into different zones so prices are “more expensive in areas where power is in short supply, and cheaper in areas where it is ample”. But in the US, Santee Cooper has taken action.
South Carolina has seen huge inward investment in data-center real estate in the past 12 months. Most notably, Alphabet, parent of Google, has said it will invest $3.3 billion in two new data centres in Dorchester County and Berkeley County. Meta, parent of Facebook, is behind an $800 million facility in Aiken County. DC Blox has a 45 megawatt campus development, also in Berkeley County. NorthMark Strategies has a deal with Spartanburg County for a $2.8 billion facility. The state is well-positioned along the Eastern Seaboard, offering decent access to metro areas in Atlanta, Charlotte, Washington DC, and even New York via fiber routes.
It is close enough to Virginia Beach, a hub for transatlantic data traffic via new high-capacity submarine cables (like MAREA and Dunant), and far enough from the coast to be shielded from hurricanes, earthquakes, and other natural disasters. It has also, until now, offered relatively competitive electricity rates, particularly when compared to other states on the East Coast. All of which lends itself to new Industry 4.0 setups, as well – as a key notch in the country’s developing ‘battery belt’. The state has seen large-scale construction of new electric vehicle (EV) and battery plants, which are likely to breach the new 50-megawatt
AESC has announced a new $3 billion EV battery plant in Florence County. Redwood Materials is planning a $3.5 billion battery plant in Berkeley County. Lithium producer Albemarle is planning a $1.3 billion refinery in Chester County. The Gazette quoted Santee Cooper, that new AI data centers in the county will need as much as 1,000 megawatts by 2030 – from about 200 megawatts, typically, today. It also cited ‘economic development officials’, suggesting EV plants need between up to 150 megawatts – for max capacity at peak times.
“That’s significant growth for a system the size of ours,” said Mike Smith, director of billing and pricing at Santee Cooper. “We do welcome large loads because they’re good loads for the system. However, because of their size and operating characteristics, they’re difficult for Santee Cooper to absorb.” The company will start charging a “special electricity rate to ensure energy-intensive data centers, built to serve the country’s ever-growing technology needs, are covering the cost of generating the massive amount of power they require”, writes the Gazette.
The new rate for new (“incoming”) customers, effective now, will be reviewed after four years. Data centers account for about two thirds of new energy requirements in South Carolina. The South Carolina Small Business Chamber of Commerce wrote in the Gazette a couple of weeks back: “Private utilities like Duke Energy and Dominion Energy are more than willing to build new power plants to serve data centers since building things is the way [they] really make their money – i.e. profits approved by the South Carolina Public Service Commission.”
He explains: “Typically, all utility customers pay for new power plants. [But] the growth of data centers and the power they require have alarmed state officials.” Indeed, the senate in South Carolina has just voted to limit tax breaks and other incentives for data centers – saying data centers should “pay an equivalent share of the costs for power plants built to serve them”, according to the Gazette. The news report goes further, and is worth a read.
