Data Centers Are Locking In Power for Decades. Are You?

Data Centers Are Locking In Power for Decades. Are You?
Data center developers do not think in months. They think in decades. When they sign agreements with utilities, they are securing the power they will need for years to come. By the end of 2025, data center projects with signed agreements on PG&E's system had nearly doubled, from about 2,000 megawatts to about 4,000 megawatts.

What 4,000 megawatts of signed deals means
Running year-round, 4,000 megawatts equals about 35 billion kilowatt-hours of electricity. At 8,000 kilowatt-hours per home, that is roughly 4.4 million homes' worth of power, already under signed agreements. Total data center requests on PG&E's system reached about 15,000 megawatts.

Why long-term power matters
Data center operators know that electricity is one of their biggest costs, so they work to secure it early and plan around it. California homeowners face the same reality on a smaller scale. Electricity averages about 30 cents per kilowatt-hour in California, and the California Energy Commission projects statewide demand could rise more than 50 percent by 2045. Homeowners who keep buying power month to month are exposed to whatever rates come next. Homeowners who produce their own power have something closer to what data centers are building: a long-term plan.

Two sides of the meter
As AI drives up energy demand, every home will be on one side of the meter. On the buying side, you pay the grid's price, including during the most expensive evening hours. On the supply side, you produce solar power, store it in a battery, and send extra electricity back to the grid for compensation. Supplying a grid that serves data centers may not be every homeowner's first choice. But it beats being on the other side of the meter, paying more as demand grows.

Locking in your own power
Solar leases have changed a lot in recent years. Qualifying homeowners can now get solar and battery storage through third-party ownership programs without buying or financing equipment. Many agreements offer a rate designed to come in below utility rates, include maintenance and battery replacement for the term of the agreement, and can transfer to a new owner if the home is sold. California is starting to value what home batteries provide. SB 913 directs regulators to set a value for battery power sent to the grid during high demand, opening the door for battery owners to be compensated.

The takeaway
Data centers are locking in their power for decades. Homeowners can lock in theirs, with savings that can reach up to 40 percent compared with utility rates, depending on the home and program.

To find out if your home qualifies for a TPO solar and battery program, visit myhomesolution.org/california_public_utility_commissions