data-center

How AI data centers could lower consumer electricity prices

Written by Joseph Nordqvist

Published: 15:37, July 4, 2026

If AI data centers were more flexible in the timing of their power consumption, electricity prices could be lower, according to a new MIT study. The researchers wrote about their study and findings in the peer-reviewed journal iScience (citation below).

Artificial intelligence (AI) is driving accelerating growth in US data centers, which raises concerns about electricity demand and emissions. In this context, “emissions” does not refer to what data centers themselves emit, but rather to greenhouse gases such as CO₂, produced by electricity generation. Coal-fired and natural gas-fired power stations emit greenhouse gases, which are the main cause of global warming.

Effect on the energy grid

Their rapidly increasing energy consumption also has raised concerns about their impact on the energy grid. What would happen to the country’s energy grid if hundreds of new data centers came online?

MIT researchers carried out a study on data centers and the country’s electricity supply and prices. They found that their impact could vary significantly, depending on how their energy consumption is structured.

Data centers might help reduce average energy costs if they consumed more electricity during non-peak hours. The environmental effect would depend on where the data center is. In some areas, more energy would be produced from renewable sources such as solar or wind power, while others would burn fossil fuels. “Fossil fuels” include natural gas, coal, and oil, which contribute to global warming when burned.

Study researcher and co-author, Christopher Knittel, an economist in the MIT Sloan School of Management, said:

“The key with data centers is: How can we add them to the network without adding a lot to our peak usage? One way for data centers to do that — to add to average usage but not the peak usage — is if they provide some grid flexibility during those high-cost periods. And that’s what we’ve been interested in understanding.”

Consume more energy during off-peak times

The researchers explained that a more flexible arrangement for energy consumption would produce the following cost savings:

  • Texas: Up to 5%
  • Mid-Atlantic region: Up to 4%
  • Western U.S. states: Up to 2%

These savings would only be possible if data centers shifted over 20% of their electricity consumption to off-peak hours. In some cases, there would need to be a 50% shift.

Citation:

Senga, J.R.L., Wang, S., and Knittel, C.R. (2026). Flexible Data Centers Reduce Power System Costs but Can Increase Emissions. iScience. DOI: 10.1016/j.isci.2026.116497.

Joseph Nordqvist Avatar

Other News

Global food prices rise as sugar leads August increases

Sep 5, 2026

A weaker currency can lift overseas profits without reviving factories at home

Sep 5, 2026

AI shortcuts may weaken managers’ judgment, researchers warn

Sep 4, 2026

Alibaba updates Qwen3.8 Max as Chinese AI rivals target workplace tools

Sep 3, 2026

Uber and Wayve begin supervised autonomous rides in London

Sep 3, 2026

Dutch central bank raises London share of gold reserves to 32.1%

Sep 3, 2026

Europe’s housing squeeze is becoming a labor market problem

Sep 3, 2026

Vertiv agrees $1.45 billion deal to expand onsite power for AI data centers

Sep 2, 2026

Advanced-economy bond yields are lifting borrowing costs for developing countries

Sep 2, 2026

‘Buy Now, Pay Later’ may lift prices for shoppers who pay upfront, model finds

Sep 1, 2026

Fast delivery can shield nearby sellers from competition

Sep 1, 2026

World Bank says domestic reforms could unlock more trade within Africa

Sep 1, 2026

GoPro agrees Starman merger as action-camera maker looks to AI infrastructure

Sep 1, 2026

UK opens first challenges under £100 million AI procurement scheme

Aug 31, 2026

SLB to buy Kelvion in $4.1 billion deal as it expands into data center cooling

Aug 31, 2026

EU online sellers declared €38.8 billion in VAT through one-stop systems in 2025

Aug 31, 2026

IMF says stablecoins could cut payment costs but weaken monetary control

Aug 30, 2026

Middle East energy shock drives renewables push and fossil-fuel safeguards

Aug 30, 2026

Build-A-Bear cuts outlook as retail sales fall and wholesale growth slows

Aug 30, 2026

HP raises outlook as PC revenue climbs 18% despite lower unit volume

Aug 29, 2026