Utility rate increases doubling the inflation rate

WABAC

So sez CNBC reporting on a "research note" from Goldman Sachs

Prices will continue to rise through the end of the decade, as data centers make up 40% of electricity demand growth, the analysts said. This will lower disposable income, drag down consumer spending and slightly slow economic growth in the coming years, they said.

Households will see electricity prices rise an additional 6% through 2027, the analysts said. Price inflation will then slow to 3% in 2028 on lower natural gas prices, they said. Consumer spending growth will fall 0.2% through 2027 and economic growth will slow 0.1% as a result, according to Goldman.

The trajectory of electricity prices, however, will vary widely across the U.S. based on different regional market structures and what regulatory choices are made, the bank said.

This does not seem to have dented utes today. GRID was dented. It seems to move--an anecdotal observation only--with the AI trade.

I can't help but wonder if there will be political retaliation against Goldman Sachs.

DrVenture

So much focus on gasoline prices by the general public. But, those can be contained. More work from home. Moving closer to workplaces, when possible. Buying more efficient vehicles, including EVs. In my case WFH and retirement, after decades of 18,000 miles+ per year.

But, electricity and natural gas can be the real pressure point. Hard to mitigate those costs. I have big doubts that data center energy costs will be carried by those businesses. It is all going to be subsidized by households, many who cannot afford it.

WABAC

Seems like the usual drill is for state's and local governments to fall all over themselves giving tax breaks to attract "jobs." That could lead to interesting results at the ballot box.

This amounts to a “massive wealth transfer,” the watchdog told PJM in a November letter.