As technology companies race to power their increasingly energy-intensive data centers, electric utilities are responding with major system expansions, from new power plants to long-distance transmission lines. Because utilities earn profits by building infrastructure, the surge in data-center demand has become a lucrative business opportunity, prompting them to offer highly attractive electricity rates to Big Tech.

At the Belfer Center’s Energy Policy Seminar, Electricity Law Initiative Director Ari Peskoe presented a recent paper, Extracting Profits from the Public: How Utility Ratepayers are Paying for Big Tech’s Power, that explains how utilities are forcing ratepayers to fund discounted rates for data centers. The talk was co-sponsored by the Mossavar-Rahmani Center for Business and Government and the Salata Institute for Climate and Sustainability.