August 26, 2025 12:49 PM UTC

Xcel Energy Wants YOU to Pay for Infrastructure Buildout for Big Data Centers

•  
• by: Colorado Pols

The special legislative session in Colorado — called by Gov. Jared Polis to address an $800 million budget hole caused by President Trump’s big beautiful bullshit bill (OBBB) — is nearing its conclusion, with most of the focus now centered around how to move forward on a second issue related to delaying the implementation of new state regulations on artificial intelligence. This debate may be a preview of how AI policy could dominate discussions at the State Capitol in the next legislative session (which begins in January).

As companies compete to become the first to launch Skynet, the discussion about AI is quickly becoming about more than guidelines related to ethics and data privacy. The immense data needs for a functional AI system that does more than just produce weird Internet graphics are a problem all their own; AI data centers require massive amounts of energy and water (for keeping its exhausted servers cool). And so far, the proposals from those responsible for meeting those energy needs has been to ask public consumers — like you — to foot the bill.

As Mark Jaffe reported last week for The Colorado Sun:

Xcel Energy customers are facing the risk of their electricity rates doubling or even tripling as the company launches an unprecedented spending plan to build new generation and transmission and feed power-hungry data centers. [Pols emphasis]

The company, the state’s largest electricity provider with 1.6 million customers, is set to invest $22.3 billion in Colorado by 2032. That is more than in any of the seven other states in which it operates.

The investments will raise its electric assets in the state, the so-called rate base upon which rates are set, from $8 billion in 2021 to $36 billion in 2029 and more than $44.6 billion in 2032, according to company filings.

“I can’t get comfortable approving anything like the level of resource need and investment the company is seeking,” Colorado Public Utilities Commission Chairman Eric Blank said at a meeting earlier this month. “That just seems like an enormous increase.”

In short, Xcel Energy wants approval from the Colorado Public Utilities Commission to jack up rates for all residential customers so that it can fund the build-out of new infrastructure so that it will have more energy to sell to big data centers. Xcel Energy wants to increase electricity sales by as much as 40 times historical averages.

While saying that the rate disparity was “an optical concern,” Jack Ihle, Xcel Energy’s regional vice president for regulatory policy, explained under questioning by Blank, that there are exclusively customer-focused investments, such as $5 billion to upgrade the distribution system.

Xcel Energy may be underestimating the rate impact even within its own model, according to the environmental and clean energy organizations Western Resource Advocates and the Southwest Energy Efficiency Project.

In a PUC filing, the groups said using the company’s long-term rate forecast model they calculated the increase by 2031 at 50%. [Pols emphasis]

Yes, Mr. Ihle: You have a bit of an “optical concern.”

The rush to provide energy for AI needs is leading to questionable decisions everywhere. Officials in Wyoming are discussing plans for a new AI data center in Cheyenne that would require five times the amount of electricity used by all residents of the state combined. In Pennsylvania, residents are concerned about a proposal from Amazon to build a huge data center that would run off of a giant extension cord plugged into the Susquehanna nuclear power plant. When Meta started building a $750 million data center in Georgia, residents suddenly found that their water taps had run dry.

The build out of massive data centers is absolutely going to require fixes to new problems facing people who are just trying to go about their daily lives, with or without the guidance of a robot adviser. The costs for these problems should fall on the gazillion-dollar corporations driving new energy needs.

If Xcel Energy wants to grow its infrastructure in order to meet the energy needs of these corporations, it damn well shouldn’t be residential consumers who get stuck footing the bill in the first place.