Month: August 2025

• AI is driving up the cost of electricity.
• Utilities in Indiana and Ohio are requiring data centers to pay more for power.
• Big Tech is fighting back as other states grapple with how to charge data center customers.

In several states, public utilities are asking power-hungry data centers to cover more of their mounting electricity costs.

Utilities have long enforced special terms and conditions, called tariffs, on their largest customers, to ensure they are paying their fair share.

Facing a historic surge in electricity demand amid Big Tech’s AI race, utilities in states like Indiana and Ohio are now turning to tariffs to protect residents and small businesses from higher power bills as more data centers come online.

Data centers consumed about 4.4% of all electricity in the US in 2023, according to research from the US Department of Energy. That amount could triple by 2028.

That level of demand growth hasn’t been seen since the 1960s, when gains in efficiency tempered the power industry’s costs of growth, protecting consumers from hefty rate hikes.

Now, power plants are more expensive to build, especially the natural gas plants that some utilities are proposing to serve new data centers.

Ratepayer advocates and regulatory experts say that using tariffs for data centers is a good start, but they may not be enough to prevent the full costs of the AI boom from hitting consumer wallets.

The demand surge coming from a handful of very large customers, combined with the rising costs of building new infrastructure, could mean the old rules of utility pricing don’t apply in the age of AI.

“Data center growth is overwhelming long-standing approaches to approving utility rates,” researchers at Harvard Law School’s Electricity Law Initiative wrote in a paper earlier this year, “causing the public to subsidize Big Tech’s power bills.”

Earlier this month, Ohio regulators approved American Electric Power’s plan to create a tariff specifically for its data center customers. In February, regulators in Indiana approved changes to Indiana Michigan Power’s large customer tariffs, aimed at shielding the utility’s individual and small business customers from higher costs associated with data centers.

Several other states, including Virginia, Texas, Kansas, and California, are considering or have proposed implementing special tariffs for data centers.

The tariffs are a response to the unprecedented demand for electricity coming from Big Tech’s AI data centers.

Investor-owned utilities in the US are on track to build $1.1 trillion in new infrastructure over the next five years, largely to keep pace with that demand, according to industry group Edison Electric Institute. About 72% of electricity customers in the US are served by investor-owned utilities, which profit by building new infrastructure.

This business model was born when population growth and economic development drove electricity demand, and everyone was thought to benefit from system-wide upgrades.

With Big Tech companies driving most of today’s electricity demand, some are questioning which customers exactly should pay for upgrades.

“We really need to think about who should pay for this stuff,” Ari Peskoe, Director of Harvard Law School’s Electricity Law Initiative, told Business Insider.

“I don’t think it’s fair to just have these very wealthy corporations come in and force utilities to build more infrastructure and then just socialize the costs the way we normally do.”

Why am I subsidizing Big Tech’s power bill?

Historically, state regulators have allowed public utilities to recover the cost of investment, plus a rate of return, of new transmission lines and power plants by raising rates for all customers.

The utility business model was based on the assumption that society benefited from the grid’s expansion; therefore, “we should all pay for the infrastructure needed to allow for its growth,” said Peskoe.

Staggering data center power demand has flipped this assumption on its head. At a time when residential electricity use is going down, Big Tech companies stand to gain the most from major utility expansion. Under the old rules of cost allocation, everyone else might have to pay for it.

In Louisiana, customers of the state’s major public utility could be responsible for $5 billion in costs associated with new natural gas plants and transmission lines needed to serve a Meta data center.

Wisconsin ratepayers could pay for a $2 million transmission project for Microsoft’s data center campus outside Milwaukee. In Colorado, Xcel Energy customers could end up paying $1.7 billion for new transmission lines to serve the state’s growing data center load.

What are states doing about it?

In February, Indiana regulators approved changes to Indiana Michigan Power Company’s tariff for large industrial customers, setting the terms for connecting data center customers to the grid.

The changes were part of a settlement agreement between I&M, its three largest data center customers — Amazon, Microsoft, and Google — consumer advocacy groups, and the Data Center Coalition.

The revised tariff requires “large load” customers that use a lot of electricity to make “long-term financial commitments proportional to their size,” I&M said in a press release.

Data centers are driving record load growth in the utility’s Indiana service territory. Peak load — the highest amount of electricity used by customers at a time — is on track to more than double by 2030.

Ben Inskeep, program director at Citizens Action Coalition Indiana, a participant in the IMP settlement, said the revised tariff will help protect ratepayers from the cost of “stranded assets” — infrastructure that gets built, but ultimately doesn’t get used. But it doesn’t address several other aspects of data center growth that could show up in consumer electricity bills, he said.

Many factors account for the final number that customers see on a monthly electric bill, and the cost of new infrastructure is just one of them.

“We’re seeing really high load growth from data centers driving the cost of capacity super high and driving the cost of building new resources super high, and those costs could still end up in consumer bills,” said Inskeep.

For its part, Big Tech is fighting to keep its own electric bills from rising.

In Ohio, a lawyer for Amazon told regulators that AEP had “singled out” data centers for a “discriminatory tariff.” A lawyer for Google called the tariff a “departure from the fundamental rules” of utility regulation.

That’s exactly the point, said Peskoe.

“What we really need is a new approach to allocating the utilities’ costs,” said Peskoe. “That’s what a lot of this comes down to — making sure that the data centers are paying for infrastructure that’s serving them, that’s being built for them.”

• Goldman’s alumni network is undergoing an upgrade under investment banking chair Alison Mass.
• Mass has rolled out new systems and features to strengthen the bank’s ties with its former execs.
• From exclusive dinners in London to a job-matching service, members took us inside the power hub.

When executives leave Goldman Sachs, they don’t really leave. They may take on new titles, relocate, or pivot industries altogether — but they often maintain close ties to the Wall Street bank. And the bank wants to maintain ties to them, too.

Now, the bank is taking full advantage of this dynamic by overhauling its alumni network to formalize and strengthen its ties with former employees.

In late 2022, CEO David Solomon and President John Waldron tapped Alison Mass, the firm’s chairman of investment banking, to take over leadership of the group. In that time, Mass, a veteran dealmaker, has transformed the group from a semi-formal network with a monthly newsletter to one of Wall Street’s most exclusive inner circles — offering access to top jobs, elite gatherings, and more.

Mass and five current and former Goldman employees — several of whom had attained the coveted title of partner when they left — gave Business Insider a look inside the overhaul, from the biggest perks for members to how the transformation is benefiting the bank.

Worldwide Rolodex

Goldman launched its alumni association in 2005 with the creation of the Office of Alumni Engagement, a dedicated team that plans events, tracks alumni career paths, and connects with the firm’s 115,000 former employees around the world.

Every former employee is automatically given membership status, though the greatest perks have always been afforded to its most powerful members: former Goldman partners, who make up more than 1,000 members.

Goldman has good reason to stay closely connected to its former executives, many of whom go on to hold high-powered roles. Alumni include Mark Carney, the prime minister of Canada and former head of that country’s central bank, and Robin Vince, the CEO of BNY. Rishi Sunak, the former prime minister of the United Kingdom, recently returned to Goldman as a senior advisor.

The bank’s most recent data shows its alumni network includes 600 C-suite execs, 15 sports team owners, CEOs, or advisors, and more than 275 people with C-suite or managing partner titles at companies with market caps of either more than $1 billion or assets under management of more than $5 billion.

Maintaining close ties helps generate commercial opportunities for the bank. Early in her tenure, Mass recalled a conversation with a former partner looking to sell his company—but unsure whom to call. She made the connection, and two years later, Goldman closed the deal.

Alumni also benefit: Katie Koch, CEO of asset manager TCW, who left Goldman in 2022 just as the alumni network’s transformation was getting underway, said not a day goes by where she doesn’t speak with a current or former Goldman partner “to work on my business or help someone else work on their business,” she said, adding: “I’ve also hired people from Goldman to help me with the transformation of TCW.”

Inside the transformation

With more than two decades of experience cutting deals and courting corporate clients, Mass knows how to manage powerful people — and it shows in how she runs the alumni association.

She personally calls every departing partner for a one-on-one conversation a few months after they leave. She also spearheaded a program to deliver handwritten notes to new partners from retired partners who once mentored them.

She sees it as a space for thought leaders to reconnect, exchange ideas, and maybe even strike some deals. One of her marquis upgrades has been the establishment of a private jobs marketplace where alumni can post jobs for other alumni, helping the network stay competitive in the talent market.

“Everyone worked with these people. They are friends,” Mass told Business Insider in an interview. “It’s people who mentored them. It’s people who they mentor. It’s their clients. And it’s fun.”

She revamped the newsletter to spotlight different alumni each month, streamlined the flow of emails, and has been inviting partners to speak to staff and provide mentorship support. The organization continues to host twice-yearly dinners for partners in London and New York.

Mass, who remains a rainmaker for the bank, is also bringing her business acumen to the project. When she took over, she assembled a task force of top partners to steer the group, including Jared Cohen, Jack Sebastian, and Sara Naison-Tarajano.

She set up targets to measure the group’s success, and worked to align the network with the bank’s OneGS strategy, a cross-company initiative to boost business and collaboration.

She also established an internal tracking system to identify every alum from the firm, which allows the bank to more easily brief bankers ahead of any meeting with a former Goldman employee.

The barbecues and hobnobbing

Goldman formers who spoke to BI said the benefits of staying in touch with former colleagues, whether through formal channels or otherwise, can be hard to quantify.

For Prabir Adarkar, the president of DoorDash, those ties remain deeply personal. Adarkar, who lives in the Bay Area, hosts an annual summer barbecue where “50% of the people there are ex-Goldman or current Goldman” employees. Some are parents from his kids’ school, while many others are colleagues from his time with the firm. “The kids are in the pool, and the grownups are people that I know through my time at Goldman.”

Earl Hunt, CEO of the private asset giant Apollo Global Management’s debt financing unit, Apollo Debt Solutions, said he credits his Goldman relationships with helping him build Apollo’s credit fund, which has made nearly $19 billion in investments.

Those connections don’t just help alumni—they help Goldman, too. Take Haidee Lee, the bank’s global head of financial sponsors M&A: After three years working for a rival bank, Lee was lured back in 2024 by her former colleagues.

“Even during the years I spent outside the firm, those relationships didn’t fade,” said Lee. “I stayed in close touch with colleagues across levels, some of whom became trusted thought partners and friends,” she continued. “And that spirit is a direct reflection of the unique culture at Goldman Sachs. It doesn’t end when you leave the building.”

U.S. President Donald Trump imposed steep tariffs on exports from dozens of trading partners, including Canada, Brazil, India and Taiwan, ahead of a Friday trade deal deadline, pressing ahead with plans to reorder the global economy.