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Advocates for lower electricity prices in Pennsylvania said Wednesday their goals can be achieved by requiring large-load users like data centers to supply their own power rather than taking it from the grid, by reducing utility profits and by speeding up the interconnection of new clean-energy projects.
The group, including the Natural Resources Defense Council, Pennsylvania Utility Law Project, the Evergreen Collaborative and state Rep. Elizabeth Fiedler, touted a report showing that consumers in the state could save an average of more than $840 a year on electricity costs by 2030 vs. the status quo if lawmakers enact policies that address the causes of soaring retail power prices.
The report, from Synapse Energy Economics, an environmental consulting firm based in Cambridge, Massachusetts, said the proposed policy reforms could reduce household electricity costs by an average of $197 in 2027 alone and deliver an estimated $2.4 billion in cost savings statewide by 2030.
Some consumers are now having to choose between paying for their electricity and their medication, and that’s not a choice they should have to make, said Fiedler, a Democrat who chairs the House Energy Committee and represents part of South Philadelphia. Residential electricity rates in Pennsylvania rose almost 14 percent in the past year alone, according to federal data. Costs for consumers were up more than 50 percent compared to 2020.
Fiedler urged lawmakers to enact reforms that lower electricity prices to levels that everyone can afford. The legislature faces a June 30 deadline for finalizing the fiscal 2027 state budget.
“Often in this building, especially during budget season, we are facing numbers that lead us to a place where we believe we must cut policies and programs that people count on,” Fiedler said at a press conference on the steps of the state Capitol in Harrisburg on Wednesday. “This report shows us the tremendous amounts of money that people can keep in their pockets.”
Fiedler and the advocates said the energy-hungry data center industry—which plans to build more than 50 of the giant computer complexes in Pennsylvania—has driven up retail power prices by increasing demand to the point that it exceeds new supply.
Fiedler urged support for HB2224, the Return on Equity bill she co-sponsored, that would ease consumer costs by lowering the profit margins of state-regulated utilities.
Patrick Cicero, an attorney with the Pennsylvania Utility Law Project, said investors would still be attracted to utilities even if the return was reduced.
“A significant share of a utility bill isn’t paying for power or pipes, it’s paying for a utility’s shareholder profit,” said Cicero, whose group works to ensure that low-income residents receive safe and affordable utility service.
The latest projected power demand from data centers would be the equivalent of adding two-and-a-half times the electricity currently used by New York City to the service territory for the eastern and central Pennsylvania utility PPL within the next decade, according to Jackson Morris, an analyst with the Natural Resources Defense Council, who spoke at the press conference.
“The rapid rise in data centers and expected future growth are unique, unprecedented and uncertain, and will require a different approach than simply asserting that basic market forces of supply and demand will take care of it,” he said.
But Dan Diorio, vice president of state policy for the Data Center Coalition, a trade group, denied that the industry causes retail electric prices to rise.
“Studies…have consistently found that data centers do not raise energy prices, and that data centers pay for all the power they use, just like any other customer,” Dorio said in a statement. “In fact, research shows that large-load users like data centers can actually keep costs down for residential customers by absorbing more of the grid’s fixed costs.” A recent study that reached this conclusion was funded by the Data Center Coalition.
Advocates for action to curb rising electricity prices also accused the grid operator PJM Interconnection of “mismanagement” by being slow to approve new energy sources, especially from clean energy like wind and solar, that might address the supply shortfall.
Jeff Shields, a spokesman for PJM, said many delays were beyond its control. “We need to build generation at a faster pace to keep up with rising demand driven by data centers, and PJM is doing everything in its power to make that happen,” Shields said in an email.
The grid operator, whose Northeast and mid-Atlantic territory covers around 65 million people, has 50 gigawatts of generation that have cleared its interconnection process but continue to face delays from forces outside of PJM’s control, including those in state permitting.
This week, the Federal Energy Regulatory Commission approved PJM’s proposal for an expedited interconnection track for large state-sponsored generation projects of any fuel type or technology that can come online quickly, and address the imbalance between supply and demand, Shields said.
“PJM continues to work closely with state and federal governments on multiple paths to bring new generation online quickly including a plan for new data centers to bring their own generation,” he said. The plan also includes an agreement by data centers to be curtailed if and when the system needs power for residential customers, he added.
In Pennsylvania, developers who want access to the state’s “Fast Track” permitting program must bring their own power, a condition demanded by Gov. Josh Shapiro, a Democrat. Shapiro, who has faced frustration from some of the residents fighting data-center development, said in a statement that a price cap he negotiated with PJM saved consumers across the region billions of dollars and his new data-center standards are designed to protect communities and ensure that developers deliver real benefits “if they want the Commonwealth’s support.”
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