BofA projects US utility bills to keep rising on grid and data center costs

September 17, 2026 at 03:00 PM2 min

This digest was compiled by AI from multiple sources — links to the originals are below.

Bank of America projects US utility bills will keep rising as grid modernization and data center demand drive costs higher. The bank found average utility bill prices rose 5.3% year over year in August, outpacing overall inflation. Some near-term relief may come from a warmer winter, but bill pressure is expected to persist.

Key Facts

Bank of America found average US utility bill prices rose 5.3% year over year in August, outpacing the 4% rise in electricity and piped gas inflation.
Detroit, Baltimore, and Washington, D.C. saw utility bills rise 10% year over year from June to August, while San Jose, Orlando, and Tampa recorded declines.
The US Energy Information Administration's August 2026 short-term outlook projects a 4% increase in commercial and industrial electricity consumption.
A Gallup poll found seven in 10 Americans now oppose data center construction in their local area.

Rising Utility Costs

Bank of America reported that average utility bill prices increased 5.3% year over year in August, following the hottest summer on record in the US. Electricity and piped gas inflation rose 4% from a year earlier, while energy bills accounted for roughly 3% of total household spending as of 2024. The bank attributed the increases to summer heat, modernization of the US power grid, and the data center build-out. Reshoring manufacturing, reindustrialization, and infrastructure replacement are driving costs higher in certain areas of the country.

Regional Variation

Utility bill growth varies across the US, with the Northeast seeing higher prices due to grid and capacity investments. Florida recorded lower prices after regulatory changes and the removal of hurricane recovery surcharges. Detroit, Baltimore, and Washington, D.C. experienced the highest energy cost increases from June to August, with bills up 10% year over year. San Jose, Orlando, and Tampa saw bills decline over the same period.

Data Center Backlash

The US Energy Information Administration's August 2026 short-term energy outlook projects a 4% increase in commercial and industrial electricity consumption, necessitating new grid investments. Bank of America said accommodating this growth will likely require ongoing investment in grid capacity and power generation, with some costs passed on to consumers through higher energy bills. Concerns about higher bills have contributed to a bipartisan backlash against data center construction, with a Gallup poll finding seven in 10 Americans now oppose local data center projects. American Superconductor CEO Daniel McGahn told Yahoo Finance that new data centers are not typically the sole driver of higher utility bills, as infrastructure costs are often part of the project rather than passed to ratepayers.