Is EV charging driving up everyone’s electric bills? 

Everyone is paying attention to their electric bill these days, as electricity prices have increased twice as fast as inflation in the past year. It’s natural to wonder if electric cars are driving the increase since they are getting more common on the roads.

The reality is that all the charging of all the EVs on the road today uses less than one percent (<1%) of the country’s annual electric consumption.

The real culprit in many areas is the meteoric rise of data centers, which are exploding in popularity thanks to the rise of AI. Data centers in the US currently use 4.5% of the nation’s electricity, forecast to grow to between 7 - 12% in the next 18 months. By the end of 2025, data centers will use 10x more energy than all the EVs on the road. 

A little math

To estimate the energy use for the 5.8 million EVs on the road by the end of 2025, we have to do a little math:

  • 30 kWh/100 miles efficiency or 0.3 kWh/mi
  • 13,500 miles driven annually
  • Per car per year: 0.3 kWh/mi * 13,500 miles = 4,050 kWh
  • 4,050 kWh * 5,800,000 EVs on the road = 23.5 TWh/year

Data center energy estimates of 230 TWh/year come from the Lawrence Berkeley Labs December 2024 report for 2025. 

For reference, a single terawatt of energy (TWh) is enough to power 90,000-100,000 homes for a year. 

Increased demand drives electricity prices up, but consumers don’t necessarily understand why

Households across the US are paying attention to a utility bill that, for many decades, was fairly stable. That's because electricity prices, which were pretty stable for the past 20+ years, are now rising as energy demand grows at least 4 times faster than it had been. Ratepayers in the mid-Atlantic, where EV penetration is still fairly low, are already seeing tangible increases in their bills, as the cost of energy is growing twice as fast as inflation, or around 5.5% year over year. Over the next five years, energy costs are forecast to rise even more, in no small part due to data center growth.

Recurrent conducted a market research survey (n=100 demographically balanced respondents) in August asking about people’s perceptions on whether EVs or data centers consume more energy. 31% of the survey respondents said either that EV charging uses more electricity (15%) or about the same amount of electricity (16%) as data centers. 

Digging into the details of the electric grid, if you’re really geeky

The reality is that the electricity landscape is in a complicated place today with many more generation constraints and demand changes than simply EV charging and data centers. Here are some great resources if you want to learn more:

But, the immediate and tangible demand trend is coming from AI data centers. As opposed to the energy needs of data centers that help you stream Netflix or manage a spreadsheet, AI data centers have an insatiable appetite for energy, using computationally expensive chips that require up to ten times more power than those used in consumer processors. Access to power is considered the major bottleneck for building out AI today.

According to a recent forecast from Lawrence Berkeley National Lab, by 2028, annual energy use by data centers is projected to nearly triple, taking up between 7 and 12 percent of total U.S. electricity demand. It will require heavy investment in infrastructure and power plants in order to supply this extra energy.

In places where AI data centers are already popping up, such as Virginia, electricity bills may rise as much as 25% by 2030. In Ohio, one utility will be supplying electricity for 30 data centers by 2030, boosting energy use in the Columbus area as high as Manhattan’s. PJM, the grid that services both Virginia and Ohio, had data centers add $9.4 billion in costs last year. 

The costs for new power plants, transmission lines, and infrastructure are generally shouldered by rate payers – including residential and small business customers. And, these large projects are paid for by ratepayers even if the data centers are delayed or cancelled. While states and utilities are working on deals to get tech companies to shoulder some of the financial burden, bills are going up. 

So the next time you worry that you're paying for an EV that someone else is driving, try to resist the urge to ask an AI search engine about it.