AI Power Boom Rewrites the Utility Playbook

AI data centers are forcing electric utilities to fundamentally redesign how they plan and operate the power grid. For decades, utilities expected flat or modest electricity demand growth, but hyperscale data centers can now demand hundreds of megawatts or even gigawatts at single locations, creating urgent pressure across transmission lines, substations, transformers, and interconnection processes. The challenge extends beyond simply building new power plants, as utilities must now manage complex infrastructure upgrades and coordinate with grid reliability organizations to integrate these massive new loads into existing systems. Equipment shortages, long permitting timelines, and competition from other industrial users for limited electrical capacity mean that power availability has become the primary constraint driving where and whether data centers can be built.