Emily Sanford Fisher Explains How Data Centers Are Ushering in a New Era of Electricity Demand

With electricity demand climbing after years of relatively flat growth, much of the acceleration is tied to one source: data centers. From artificial intelligence applications to cloud computing and enterprise storage, digital infrastructure is expanding rapidly across the United States, and observers tracking grid trends say this marks a meaningful shift in load growth. Energy strategist and founder of Enodia Energy, Emily Sanford Fisher, has pointed to data center expansion as one of the most consequential developments shaping the power sector today.

A Structural Shift in Load Growth

Data centers are energy-intensive by design. Facilities often operate around the clock, requiring constant power to support servers, cooling systems, and backup infrastructure. A single hyperscale facility can require as much electricity as a small city.

In states like Virginia, Texas, and Arizona, clusters of data centers are adding thousands of megawatts of projected demand to utility planning forecasts. That growth must be met with a new generation, expanded transmission capacity, and upgrades to local distribution systems.

"The growth in data center demand is significant in some parts of the country, and utilities are working to plan for it carefully," Emily Sanford Fisher said when discussing grid planning. "Meeting new load growth requires thoughtful coordination to maintain reliability and affordability for all customers."

Infrastructure and Investment Implications

Rising data center demand has direct implications for infrastructure investment. Utilities must ensure they have adequate generation resources to meet peak demand, sufficient transmission to move power across regions, and resilient distribution systems to deliver electricity locally.

Those investments can include:

• New natural gas, renewable, and storage resources
• Expanded transmission lines, including new high-voltage lines
• Substation upgrades and deployment of new advanced grid technologies

These projects require regulatory approval and long-term financing. Capital investments and other costs to serve new customers are recovered over time through retail electricity rates paid by all customers. That dynamic has raised important questions about cost allocation and fairness, particularly when large new loads seek to interconnect to the grid.

Utilities and regulators are increasingly focused on ensuring that data center customers bear an appropriate share of the infrastructure costs required to serve them. New rate designs, special contracts, and cost recovery mechanisms are being examined to align investment with usage. And, data centers are increasingly pledging to pay their fair share of costs. Many big tech companies recently signed a "Ratepayer Protection Pledge" at the White House, committing to pay for the costs of meeting their large electricity needs.

Reliability and Resource Planning

As Emily Sanford Fisher explains, beyond cost considerations, reliability remains central. "Data center customers prioritize high levels of uptime, and the broader grid must continue serving residential and commercial customers without disruption, meaning that new generation resources are essential to ensuring reliability for all customers. Even as many data center customers consider how to be more flexible in how they use electricity, there is an urgent need to add generating capacity to the overall system, especially to meet demand on peak days."

In some regions, data center developers are exploring colocation with new generation resources—taking a "bring your own power" approach—including renewables paired with battery storage. Others are entering into long-term power purchase agreements to support additional supply. These arrangements can help meet their own needs and can influence how utilities plan future resource additions. "Utility investments are long-lived, so understanding the size and scope of new electricity demand is essential for ensuring not only that the right resources get built, but also that there are no stranded investments that increase electricity rates," said Fisher.

Data centers, however, are not the sole driver of electricity demand growth. Importantly, demand growth from data centers is occurring alongside broader electrification trends. Electric vehicles, heat pumps, and industrial electrification are also contributing to higher load forecasts. "This underscores the importance of good resource planning to meet future electricity needs reliably and affordably," emphasized Fisher.

Policy and Market Signals

Policy clarity plays a significant role in this transition. Stable regulatory frameworks can reduce financing costs for new infrastructure and encourage coordinated development. Uncertainty, by contrast, can complicate long-term planning.

At the same time, many policymakers view data center investment as an economic development opportunity. These facilities create construction jobs, expand local tax bases, and anchor technology ecosystems. Balancing economic growth with grid reliability and affordability requires coordination between utilities, regulators, and state leaders.

As Fisher notes, the current moment calls for careful planning rather than reactive decision-making. "Load growth presents an opportunity for many stakeholders—states, utilities, the data centers themselves—but it also demands disciplined investment, which can only be accomplished with transparent demand projections and fair cost allocation."

A New Chapter for the Grid

The expansion of data centers marks a turning point for the U.S. electricity system. After nearly two decades of modest demand growth, utilities are once again planning for substantial new load growth. Meeting that demand will require generation development, transmission expansion, and continued grid modernization.

As the power sector adapts to this new era of electricity demand, the conversation is likely to intensify. The questions are not only about how much power is needed, but how it is built, financed, and integrated into the broader system.

Who Is Emily Sanford Fisher?

Emily Sanford Fisher is an energy strategist and policy expert with experience spanning utility regulation, clean energy strategy, and grid modernization. She has held senior leadership roles at national energy organizations and now leads Enodia Energy, a consulting firm focused on advancing an affordable, reliable, and clean energy future. Emily Sanford Fisher frequently speaks on issues including electricity demand growth, infrastructure investment, and the evolving dynamics of the U.S. power sector.