In Indiana, a utility is ready to drop rates for customers – and Data Centers are the reason.
It’s not hard to understand.
When you get a big customer on the grid that is willing to pay to help amortize all those power plants, towers and wires, you spread the costs out more, and rates can go down.
Fort Wayne Journal-Gazette (Indiana):
If state regulators approve Indiana Michigan Power’s latest base rate reduction request, the Fort Wayne-based utility’s residential customers could see $100 in annual savings.
The estimated savings is for the average residential customer using 1,000 kilowatts a month. Total customer savings in 2027 is estimated at $59 million, officials said.
I&M expects the Indiana Utility Regulatory Commission to announce a decision on the proposed plan in June of next year, according to the news release. In that scenario, customers would begin to realize savings next summer, the release said.
The utility also proposes freezing rates at the lower amount for three consecutive years.
A local economic development official and a social services executive applauded the move on Wednesday.
John Urbahns, president and CEO of Greater Fort Wayne Inc., said his organization’s work helps grow the economy in ways that benefit residents.
“One of the reasons we work so hard to attract investment to northeast Indiana is because growth should create benefits that extend beyond a single project or company. It should create real value for the people who live and work here,” Urbahns said in a statement that also accompanied I&M’s announcement.
“That’s why we’re pleased to see our collaboration with Indiana Michigan Power helping lower utility costs for customers,” Urbahns continued. “Savings like these strengthen household budgets, support local businesses and contribute to a stronger economy for our entire region.”
I&M described its request to state regulators as “one of the nation’s largest base rate reduction plans.” Rates for the utility’s Indiana customers already have been reduced twice in the first six months of this year, officials noted.
“The plan is made possible thanks to load growth and increased revenue from large customers including data centers,” the release said.
I&M’s request comes at a time when Gov. Mike Braun has called on utilities to make energy more affordable. He also has been a strong proponent of welcoming data centers into the Hoosier State.
“Economic growth should not come at the expense of existing customers,” Braun said in a statement included in I&M’s news release. “Indiana Michigan Power’s proposal shows what’s possible when we create the right environment for investment while keeping Hoosier families front and center. Lower utility bills, long-term rate certainty and continued investment in our electric system are exactly the kinds of results we want to deliver for Indiana.”
Maryam Brown, I&M’s president and chief operating officer, said the utility works in partnership with Indiana government officials.
“As Indiana continues to experience unprecedented growth, we are taking action to help our customers benefit from that growth through lower costs, enhanced value and continued investments to strengthen our system,” she said in a statement. “We are proud to join forces with state leaders to advance economic development and make energy more affordable – while continuing to provide system reliability upgrades.”
I&M’s employs about 2,000 workers, who serve more than 600,000 customers. More than 85% of its energy delivered in 2024 was emission-free, the release said. Its largest source of energy is nuclear, which is generated in Michigan.
Michael Webber in Houston Chronicle:
It doesn’t have to be this way. There’s room for a more positive vision of how data centers fit into our lives. Data centers done the right way improve our local grid, water systems and electric rates. Done the wrong way, they make things worse.
Rather than reflexively opposing the latest technology or pursuing moratoria that push this once-in-a-generation investment opportunity to other states — or worse, to China — we should strive to build and operate them the right way so we harness the economic and security benefits of homegrown AI capability while minimizing harm to Texan ecosystems, ratepayers and taxpayers. Along the way, this incredible technology might accelerate medical breakthroughs or scientific advances to the benefit of all of us.
Data centers offer desirable economic opportunities. Importantly, the jobs related to building and operating data centers pay premium wages. The oil and gas industry will recognize this storyline. The higher pay of energy extraction, especially compared with agricultural jobs, was a key selling point when oil and gas faced local resistance in the early days of the fracking boom. And, as Houston billionaire investor and philanthropist John Arnold has observed, areas with major data-center buildouts have collected so much extra tax revenue that it allows them to cut rates for residents.
At the same time, data centers’ downsides are real but can be managed. Yes, data centers can strain the grid if they stay on at full power around the clock, if they cause big demand swings by rapidly cycling on and off or if they suddenly disconnect from the grid without warning. But if they are willing to smoothly and controllably dial back their demand during the hours of scarcest power in the grid — usually in the hot summer evenings — and have what’s called the ability for voltage ride-through to handle short power disturbances, they can actually improve grid reliability. In fact, data centers can actually cause overall prices to go down.
Here’s how it works: As it stands, our grid in Texas contains hundreds of billions of dollars of specialized equipment for power plants, transmission lines, substations and distribution systems. But we only use the grid about 50% of the time on average. We design the grid to meet our peak demand on a hot summer afternoon, but the rest of the year we have a lot of spare capacity. If data centers drive up our overall electricity consumption but without driving up peak demand, then we can divide all that investment over more kilowatt-hours of electricity, lowering the price for everyone.
If we make data centers flexible in their demand for electricity, powered by clean energy, water-positive and carbon-negative, quiet and beautiful, then most complaints will fade away.
Lawrence Berkeley National Laboratory:
Forecasted load growth from data centers, manufacturing, and other drivers has created concerns that increasing load might place upward pressure on wholesale prices and T&D delivery infrastructure, and thus also retail electricity prices.
Over the last 5 years, however, states with the highest growth saw average prices decline in inflation-adjusted terms (over 1 cent/kWh in some cases); states with load reduction / contraction often saw prices increase.
Statistical analysis by LBNL presented later confirms this finding, controlling for other variables
• Recent cost increases have not primarily been due to load growth; it is therefore natural that load growth over this period tended to reduce prices as fixed costs are spread over more demand (and the reverse for load reductions)3
• Quotes from Georgia, California, Maine support concept of load growth potentially putting downward pressure on prices
• Importantly, this relationship need not always exist: a higher growth future can increase retail prices if new supply and delivery infrastructure is constrained and costly—as it currently appears to be in some or many states
ATLANTA – The Georgia Public Service Commission approved a stipulated agreement on Thursday to lower utility rates for Georgia Power customers starting June 1.
The regulatory body voted to pass the deal without changes, establishing how the utility can bill for fuel costs and storm damage restoration expenses.
In July 2025, the Georgia Public Service Commission (PSC) approved our plan to freeze base rates for three years, except for storm and fuel filings, which combined, will lower rates for the typical residential customer, beginning in June. While prices on everyday items like food, housing, and utilities are rising across the country, base rates—the cost of delivering electricity and maintaining the power grid across Georgia—will remain stable for our customers.
The decision, approved in July 2025, follows new rules and regulations approved by the PSC in January 2025, which help keep rates fair by requiring new large-energy users moving to Georgia, like data centers, to pay the costs needed to serve them.