Severin Borenstein on the Public Cost of AI

Is Your Electric Bill Going Up? AI is Partly to Blame

November 6, 2025

NPR

Severin Borenstein, Energy Institute Faculty Director, examines how the public bears the financial burden of supplying electricity to data centers that support AI on NPR.

“In theory, the new data centers springing up to support the artificial intelligence boom should cover their own power costs and at least a bit more, potentially lowering bills for nearby residential customers…’That doesn’t seem that hard to do,’ says Severin Borenstein, faculty director of the Energy Institute at U.C. Berkeley’s Haas School of Business. ‘But you’d be surprised how many politicians and regulators say…Well, this is an economic development opportunity. We should give them a great rate…And in their enthusiasm, they’ll end up charging rates that don’t even cover the incremental cost.'”

Photo: npr.org