By Jim Hooton, GECO Board Member
As the digital economy expands, so does the energy footprint of the “hyperscaler” tech companies building massive data centers to power AI. These facilities dominate the news as utilities rush to keep up — and ratepayers worry about being left with the bill. In Colorado, Xcel Energy plans to invest $22 billion by 2040 just to meet rising electricity demand. And fossil fuels appear poised to play a major role in that expansion. New gas-fired power plants have been proposed by Tri-State, Xcel, United Power, Platte River Power Authority, and Colorado Springs Utilities.
A Better Path: Households as Grid Assets
There is a promising alternative. Rewiring America’s Homegrown Energy report shows that instead of building new gas plants, utilities and tech companies could meet growing demand by investing in household electrification — installing heat pumps, rooftop solar, and home batteries so homes function as part of the grid capacity solution. According to the report, hyperscalers could meet 100% of projected data-center demand growth by covering part of the cost of these residential upgrades. The residential upgrades would either directly reduce electricity demand during peak times with more efficient electric appliances, or by generating electricity from solar panels and storing it in batteries to be discharged during peak periods, so that it doesn’t have to be supplied by the grid. The resulting excess electrical capacity could supply the data centers while also lowering household energy bills, improving grid resilience, and accelerating the transition to an all-electric future.
Colorado’s data-center boom is real — and so is the strain on the grid. But rising demand does not have to mean new fossil plants or higher costs for families. If we treat homes not just as energy consumers but as infrastructure, powered by efficient electric appliances and local solar and storage, we can expand capacity, reduce emissions, and build a more affordable, resilient grid.
This is a critical moment to redirect corporate demand growth into community benefit. Let’s champion a strategy in which the outcome isn’t just more data-center capacity — but cleaner homes, lower bills, and a grid that works for everyone.
The Rewiring America Report:
https://www.rewiringamerica.org/research/homegrown-energy-report-ai-data-center-demand
Rising Electrical Bills
New Proposed Gas Plants
https://coloradonewsline.com/2025/07/03/after-coal-colorado-natural-gas-electricity/
