Why Energy Prices Are Rising for Bitcoin Mining and Tier-3/4 Data Centers in the USA

Sep 3, 2025 | Updates, Knowledge Base

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Why Energy Prices Are Rising for Bitcoin Mining and Tier-3/4 Data Centers in the USA

The U.S. power market is entering uncharted territory. Both Tier-0 Bitcoin mining and Tier-3/4 AI & cloud data centers are driving massive new demand—shaping how utilities plan, how regulators react, and ultimately, what consumers pay.

The Scale of PJM’s Emerging Pressure

PJM Interconnection, the largest RTO in the United States, manages power for 65 million people across 13 states. Its own forecast is stark: between 2024 and 2030, PJM expects 32 GW of peak-load growth, with as much as 30 GW tied directly to data centers.

The result?

Capacity auctions skyrocketed, with some zones seeing prices rise over 1,000% in two years—reaching $329/MW-day for 2026/27 delivery.
Congestion costs hit $503M in Q1 2025, up nearly 60% year-over-year.
PJM’s Independent Market Monitor attributes ~70% of a $9.3B cost spike to data center load alone.
To keep the lights on, PJM has approved nearly $6B in transmission projects—but ratepayers across states like West Virginia ($440M exposure) are footing bills for upgrades serving Virginia’s “Data Center Alley.”

Translation: Wholesale volatility is translating into higher retail rates, even for households and small businesses far from the new tech hubs.

Duke Energy: The Southeast Version of the Same Story

PJM is not alone. Duke Energy Carolinas projects that 45% of its new large-load growth through 2033 will come from data centers. To keep up, Duke is planning a 1.4 GW gas plant in South Carolina and billions in transmission upgrades.

Consumers are already feeling it:

Duke requested a $10.38/month residential bill increase by March 2026 in South Carolina.
Commercial and industrial customers face 5–5.4% hikes.
Large loads are also being funneled into bespoke green tariffs and demand-response programs, ensuring they bear some of the system cost—but not all.

Why Both Tiers Push Prices Up

Tier-0 (Bitcoin Mining): Price-sensitive but still a stressor. While miners can curtail and participate in demand response, when they cluster in constrained zones, they push up capacity requirements, congestion, and reserve margins.
Tier-3/4 (AI, Cloud, HPC): Firm, around-the-clock demand. They require redundant capacity, substation expansions, and high-voltage upgrades. Their reliability profile is far less flexible—forcing utilities to build new baseload plants and accelerate capex.

Strategic Outlook: What Needs to Change

Policy reform: States like Pennsylvania and New Jersey are moving toward “cost-causation” rules so tech giants, not households, bear the brunt of infrastructure bills.
Grid modernization: More distributed renewables, nuclear, and advanced gas assets are needed for resilience.
Private-sector responsibility: Operators must invest in back-park generation, batteries, and flexible load to reduce systemic strain.

Without these shifts, ratepayers everywhere will continue subsidizing the digital economy’s rapid expansion.