Commercial electricity demand in the U.S. has increased significantly in the limited number of states experiencing rapid development of data centers while holding steady or declining elsewhere, according to new report by the Energy Information Administration (EIA). Overall U.S. consumption totaled 14 billion kilowatt-hours (kWh) in 2023, up 1% from pre-pandemic levels in 2019. But commercial demand in the 10 states with the most electricity demand growth increased by 10% to a combined 42 billion kWh between 2019 and 2023. Demand in the 40 other states decreased by 3%, or 28 billion kWh, over the same period.
Electricity demand has grown the most in Virginia (see top line in graphic below), largely driven by Dominion Energy Virginia, the main electricity utility in the state. As we wrote in Storm Front, Virginia is home to about 150 hyperscale data centers, according to the Virginia Economic Development Partnership, which says the facilities are drawn to the state’s competitive taxes, affordable electricity rates and strong digital infrastructure. (Hyperscale data centers are generally considered to have at least 5,000 servers and be at least 10,000 square feet in size. The biggest data centers, however, can be more than 1 million square feet across multiple buildings.)
Electricity demand also grew substantially in Texas, where relatively low costs for electricity and land have attracted a high concentration of data centers and cryptocurrency mining operations. North Dakota posted the fastest relative growth at 37% between 2019 and 2023, attributed to the establishment of large computing facilities in the state. In addition, western states such as Arizona and Utah have shown robust growth in commercial electricity demand, further contributing to the overall increase in the top 10 states. In contrast, demand for electricity by the commercial sector in some large states such as New York, Illinois and California has been flat or has declined compared with 2019.
