A little more than a mile outside Harwood, North Dakota, a town of about 800 people, two buildings are going up on the plain. Each is 907,000 square feet. Together they are about 50% larger than the Amazon warehouse a couple of miles south that used to be the biggest building in the state. They belong to Applied Digital, which is building them for Oracle, and when they are finished they will draw 280 megawatts. In September about 1,800 people were working on the site, out of trailer offices and a catered tent. “It’s like a small city,” the company’s regional affairs director told the Grand Forks Herald.
In August, a group of residents calling themselves Voices of Harwood collected 91 signatures in three days to put a measure on the November ballot. It would have required independent reviews and public hearings before the city approved projects of that size. On November 3, Harwood voted it down, 325 to 105.
That made Harwood the exception. Voters decided 41 local ballot measures on data centers that day, in ten states, and restrictions passed in every one but Harwood’s, by an average margin of 49 points. “I think the citizens made the right call,” Harwood’s mayor, Blake Hankey, said afterward. Michael Swartz, who organized the measure, was less sure he would stay. “I don’t know that I’m going to be living here,” he told the Fargo Forum, “and that hurts.”
Barbara Trish, a political scientist at Grinnell College who studied the results, noted what set Harwood apart. Its data center was already rising, and local leaders had persuaded voters that limits would cost the town revenue. The mayor expects the project to pay $1.65 million in taxes by 2028. Harwood was weighing a building it could see. Most of the country was weighing a promise against a power bill.
The rest of the election ran the other way. Campaigns spent more than $380 million on television ads that mentioned data centers. Of the first 34 governors-elect, Data Center Watch found that 32 favor stronger regulation or restrictions and twelve favor bans or moratoriums. In Texas, where Greg Abbott had already halted state permits for data centers in September, Gina Hinojosa beat him after promising “a moratorium — a ban — on all data center approvals.” Within a week, Josh Hawley was posting “MORATORIUM on data centers,” and Bernie Sanders was calling for a national one.
The voters who said no have good reasons, and I will spend the first part of this essay on them. But their anger is aimed at the wrong target. American power bills are rising because the country stopped building the plants and the wires that keep electricity cheap, and data centers arrived just in time to expose it. A moratorium answers a shortage by building less. It will not lower anyone’s bill, and it will hand China the one input the next decade runs on.
The bill
Start with what the voters were looking at. The average American household paid 16.5 cents per kilowatt-hour for electricity in 2024, and the Energy Information Administration expects 18.2 cents this year. The steepest climb is in PJM, the grid that runs from New Jersey to Illinois and serves thirteen states and Washington, D.C. Each year PJM holds an auction for capacity, which is what utilities pay to make sure enough power plants will be standing on the hottest day of the year. In two years the price went from $28.92 per megawatt-day to $329.17.
Last December, PJM announced the results of its latest auction in a release datelined Valley Forge. The price had hit the cap, and the grid had still come up 6,623 megawatts short of what it needs for reliability. Nearly all of the growth in forecast demand had come from data centers. “This auction leaves no doubt,” said Stu Bresler, an executive vice president, “that data centers’ demand for electricity continues to far outstrip new supply.”
Households are paying for that demand. The Harvard Electricity Law Initiative reviewed about fifty utility proceedings and found that the special contracts utilities sign with large technology customers routinely shift costs onto everyone else. The Union of Concerned Scientists found that in more than 95% of the data center connection projects it examined in seven PJM states, the cost went to ratepayers. Economists at MIT, studying data center openings from 2010 to 2024, estimate that a data center’s arrival raises local residential rates by 2.1% on average, and by 5.6% where the utility is investor-owned.
People who remember the 1980s have heard this before. In the 1970s, utilities ordered nuclear plants on the assumption that demand would keep growing at its postwar pace. Demand slowed, costs exploded, and the plants arrived years late or not at all. Congress’s Office of Technology Assessment warned in 1985 that the outcomes could range “from utility bankruptcies to large rate increases, often referred to as ‘rate shock.’” Union Electric asked Missouri regulators for a 70% increase to pay for a single plant. Regulators threw out about $14 billion in nuclear costs that decade, and customers paid the rest.
The data center boom has the same shape. Utilities plan around announced projects, and many announced projects are speculative. When Ohio began requiring data centers to commit to paying for the capacity they requested, the data center demand in AEP Ohio’s forecast fell from about 30 gigawatts to 13. Most of it had been a request for grid capacity that its sponsors were not prepared to pay for.
Then there is the process. In Prince William County, Virginia, the board approved the Digital Gateway, 23 million square feet of data centers on 2,100 acres, by a 4 to 3 vote in December 2023. Residents sued. Two courts found that the county had not given proper public notice and declared the rezonings void, and in July the developers gave up. Texas, meanwhile, forgoes more than $1 billion a year on its sales tax exemption for data centers.
Read charitably, the vote on November 3 was a vote against a deal in which households carry the risk of the buildout while companies worth trillions keep the upside. On that, the voters are right.
But look again at that December auction. It cleared 774 megawatts of new generation against a shortfall of 6,623. The data centers did not dig that hole. PJM warned in 2023 that 40 gigawatts of existing generation was at risk of retiring by 2030, and that new plants were not arriving fast enough to replace it. Across the country, the median power project completed in 2025 had waited 61 months to connect to the grid, against 36 a decade earlier. America built nearly 4,000 miles of high-voltage transmission in 2013 and 888 miles in 2024. Its newest nuclear plant, Vogtle in Georgia, came online seven years late at a cost of about $35 billion. No other reactor is under construction.
The data centers arrived at a grid that had stopped growing, and they made the shortage visible. The bill is what a shortage looks like.
The pause
On the north shore of Long Island, past the beach at Wading River, a large blue building rises behind the trees. It is the reactor at Shoreham, and it has never lit a home.
The Long Island Lighting Company proposed it in 1965, began construction in 1973, and finished most of the work a decade later. By then public opposition and safety concerns, above all whether the island could be evacuated in an accident, had made it impossible to run. In 1989 the company agreed to abandon the plant and sold it to the state’s new power authority for one dollar. Regulators had already found the construction imprudently managed and made shareholders swallow about $1.4 billion. Ratepayers took the remaining $4.2 billion, to be recovered over forty years, along with a decade of 5% annual rate increases. In 2017, Long Islanders were still paying off Shoreham debt. A former Long Island power official called the building “kind of like a monument to some very bad decisions.” This fall, New York bought the forest around it for a preserve. A battery project is planned on the site.
Stopping Shoreham refunded nothing. A data center moratorium works the same way. The capacity PJM bought for next year is bought, and the lines approved in 2024 are in the rate base. A pause slows the growth of future demand, which may soften the next auction, but it does nothing about the last one and nothing about who pays for it. It does not build a single power plant.
What it does do is last. Every moratorium in this cycle is promised as temporary. Hinojosa’s lasts until protections are in place. Hawley’s office told Politico his would last until Congress passes “a bill of rights giving taxpayers guarantees of no rate increases,” a condition no Congress can meet. In 1976, California barred new nuclear plants until the federal government found a way to dispose of spent fuel. It never did, and the law is still in force fifty years later. Illinois lifted its ban on large reactors only this year. A pause tied to a condition that cannot be met is a ban that has not yet admitted it.
And this pause would land at the worst possible time, because the grid is built years ahead. GE Vernova, America’s largest maker of gas turbines, is now booking delivery slots for 2031. About four of every five power transformers the country installs are imported, and the median new power plant spends five years waiting to connect. A gas turbine ordered this winter will arrive in 2031. A plant that is not ordered this winter will not exist in 2031 at all, and the demand will have arrived anyway.
The irony is that the real grievance, who pays, is already being fixed. The principle that cost Shoreham’s shareholders $1.4 billion is that whoever causes a cost should carry it. New large-load tariffs apply that principle to data centers before the money is spent. Ohio’s, approved in July 2025, requires AEP Ohio’s data center customers to pay for at least 85% of the capacity they contract for, for up to twelve years, with an exit fee if they leave. Virginia created a separate rate class for its largest customers, effective in January, with minimum bills, collateral, and exit fees. Georgia, Oregon, Minnesota, and California have adopted or ordered versions of the same idea. In June, federal regulators told all six regional grid operators to justify their rules for connecting large loads or rewrite them.
A moratorium arrives after the fix and stops the projects that would pay under it.
It also stops the projects that could help. The Pacific Northwest learned that decades ago. From 1939 the Bonneville Power Administration sold cheap hydropower to aluminum smelters, and under contracts signed in 1975 the first quarter of each smelter’s demand could be interrupted when water or supply ran short. During the Western energy crisis of 2001, Bonneville went further and paid smelters not to run, buying back 420 megawatts from one in Longview at under half the market price while the plant kept paying its workers. “Not having to serve this load next winter,” said Bonneville’s Steve Wright, “is a tremendous benefit to Northwest ratepayers.”
Data centers can do the same, because much of their work can wait minutes or hours. Researchers at Duke University estimated that the American grid could absorb 76 gigawatts of new load if that load agreed to curtail just 0.25% of the time. Google has signed agreements with utilities in Indiana and Tennessee to pause machine-learning work when the grid is stressed, and Texas now requires new large loads to accept curtailment in emergencies. A moratorium cannot tell a flexible load from a rigid one, so it stops both.
It stops the revenue too. Loudoun County, Virginia, collected $1.2 billion from data centers in fiscal 2026, 39% of its budget. And the demand does not go away when Texas says no. Morgan Stanley warned after the election that state rules could “split the country into areas that are open to new data centers and those without.” The projects go to the places that stay open, often the ones with the weakest rules on water and cost. Nationally the stakes are higher, because the competitor that is pausing nothing is China.
The other country
On the evening of September 23, 2021, the power went out across China’s northeast with almost no warning. Traffic lights in Liaoning went dark, and residents of high-rise apartments took the stairs because the elevators had stopped. Some shops stayed open by candlelight. “Without any warning, the water and power were suddenly cut,” a resident of Ji’an, in Jilin, told the news site Sixth Tone. At a foundry in Liaoyang, the rationing shut down the exhaust system, and 23 workers were treated for gas poisoning. “We have not met the power cut for more than 10 years,” a Shenyang resident told China Daily. The provincial party paper explained that the cuts were needed to “prevent the collapse of the entire power grid.”
About twenty provincial-level regions rationed power that autumn, and Goldman Sachs estimated that 44% of China’s industrial activity was affected. The next August, drought cut hydropower in Sichuan, and factories in 19 of the province’s 21 cities were ordered to halt.
Beijing’s answer was to build. That December, the Central Economic Work Conference adopted the principle of “establishing the new before breaking the old,” meaning no source of power would be retired until its replacement was running. Regulators let coal power prices float, approved 106 gigawatts of new coal plants in 2022, more than four times the year before, and announced some 450 gigawatts of wind and solar in the western deserts. China’s lesson from a shortage was to build. America’s, so far, is to stop.
In 2025, China added 543 gigawatts of generating capacity. The United States added 53, about a tenth as much, and that was its biggest year since 2002. China has added more capacity since 2021 than exists on the entire American grid, and it already generates more than twice as much electricity as the United States. The International Energy Agency expects Chinese demand to grow by about 2,600 terawatt-hours by 2030, an increase equal to more than half of everything America uses in a year.
China's lesson from a shortage was to build. America's, so far, is to stop.
It builds the wires as well. China’s ultra-high-voltage direct-current network grew from 28,000 kilometers to more than 40,000 between 2021 and 2025, and the 2,087-kilometer line from the Baihetan dam to Jiangsu took about eighteen months to build. China has 41 nuclear reactors under construction. The United States has none.
It also decides where its data centers go. In 2022 it launched a program called East Data, West Computing, which designated eight national computing hubs and steered new capacity toward the energy-rich interior. According to the Oxford Institute for Energy Studies, approval faces “substantial hurdles” in Shenzhen, Shanghai, and Beijing but “may be quite easy” in Ningxia and Gansu. The United States is making the same decision one local ballot measure at a time.
This matters most for artificial intelligence. A Federal Reserve analysis estimates that the United States controls 74% of the world’s high-end AI computing capacity and China 14%, and it names energy infrastructure as China’s largest advantage. America’s main defense of its lead is export controls on advanced chips. China’s response has been to use more chips that are weaker, and much more electricity. Huawei’s CloudMatrix 384 system delivers almost twice the computing power of Nvidia’s flagship rack by linking more than five times as many chips, and it draws 4.1 times the power to do it. The research firm SemiAnalysis titled its section on the trade-off “China has No Power Constraints, just Silicon Constraints.” Several interior provinces have offered to cut data centers’ electricity bills by as much as half if they run Chinese chips.
Export controls still bind, because China cannot yet make enough advanced chips. But their force depends on electricity being scarce enough that wasting it hurts. Every gigawatt China adds loosens them, and every gigawatt America declines to connect makes its chip lead worth less.
The advantage extends well past AI. Rhodium Group calculates that in 2025 China’s wind and solar generation alone exceeded the total industrial power consumption of the United States. China makes about 93% of the world’s polysilicon, a material whose cost is more than 40% electricity, and more than 80% of its battery cells. Rhodium concludes that Western dependence on these supply chains “will remain structural, not temporary.”
None of this makes China a model. The Oxford Institute finds that Chinese electricity prices are comparable to American ones. China commissioned 78 gigawatts of coal plants in 2025 while its coal fleet ran at about half its capacity, and Chinese industry reports estimated in early 2025 that up to 80% of newly built computing capacity was sitting idle. China overbuilds, and it pays for that in waste. But the same Oxford paper concludes that, unlike in the West, China “faces no electricity supply barrier to data centre growth, at least at a national level.” A country that overbuilds wastes money. A country that underbuilds rations.
America is about to need far more than it has. Data centers used 1.9% of the country’s electricity in 2018 and 4.4% in 2023, and Lawrence Berkeley National Laboratory expects 6.7% to 12% by 2028. PJM now forecasts its peak demand growing 3.6% a year through 2036. AI is only the first claimant. As I argued in Escape Velocity, the limits on turning better software into faster growth are physical, among them factories, robots, and the grid itself. All of them run on electricity, and the country that has it will try more of them sooner.
The lights
Within living memory, most of the Texas Hill Country had no electricity. Robert Caro, in The Path to Power, describes what that meant for the women who lived there, hauling water up from wells by hand and ironing with heavy irons heated on wood stoves. He called the chapter “The Sad Irons.” Private utilities would not string lines to farms that far apart, and as Caro tells it, a young congressman named Lyndon Johnson went to Franklin Roosevelt to get around the federal rules that said the region was too sparse to serve.
In September 1938, the Rural Electrification Administration approved $1,332,000 for the new Pedernales Electric Cooperative to build 1,718 miles of line, which the Texas State Historical Association calls “the longest mileage and the most money ever granted in a single approval.” The first section was switched on November 1, 1939, for 422 members in Burnet County.
The rest of rural America followed. In 1930, about one American farm in ten had electricity. In the Tennessee Valley in 1933, private utilities had reached 3% of farms. By 1950, more than 90% of American farms had power. On January 7, 1937, a farm woman named Lula Weesner wrote in her diary, “Eventful day! Our electric lights were turned on today.” Between 1950 and 1970, American electricity generation more than quadrupled.
Gina Hinojosa takes office in Austin on January 19, in the state where that happened. Since the election she has softened her language. “It is not that I hate data centers,” she told CNN. “I hate the way they are taking advantage of Texas, and that stops when I’m governor.” That is a mandate to set terms, and she could set them in her first week without stopping a single project.
She could make data centers pay their own way, with minimum bills, long contracts, and exit fees like Ohio’s, so that if the boom deflates, shareholders carry the loss and neighbors do not. She could build on the law Texas already has and let data centers that agree to curtail connect sooner than those that will not. She could require every new campus to bring its own generation, turning the “build, bring, or buy” pledge the largest technology companies signed at the White House this year into a condition of service. She could finish what Abbott started and end the subsidies, as Arizona did when it paused its sales tax exemption. “Nobody’s talking about a moratorium on data centers themselves,” Arizona’s governor, Katie Hobbs, said at the time. And she could require every campus to disclose its water and power use, as California will starting in January.
The rest belongs to Washington. On November 9, the Senate voted 73 to 25 to begin debate on a bipartisan bill that would make data centers pay for both existing and new transmission. It should pass, and it should be paired with what the country actually lacks: permission to build the 5,000 miles of high-voltage line a year that planners say it needs, factories for the transformers and turbines it now waits years to buy, an end to the remaining state bans on nuclear construction, and the electricians to wire all of it.
Applied Digital expects part of the Harwood campus to be running by the end of this year. It will draw its power through a substation and transmission lines the company paid $112 million to build. The nearest house is half a mile away. Harwood voted for that, and it was the only town in the country that did this month. It could see what it was getting and what it would pay.
The rest of the country deserves the same terms. Offer them, and many voters will make Harwood’s choice. Withhold them, and voters will keep saying no, and the plants and lines the next decade needs will not be ordered in time.
In 1930, nine of every ten American farms were dark. Twenty years later, nine of ten had power. The country that did that is still here. It has only to remember how.
Aspera: A country that underbuilds rations.
Astra: The country that did that is still here.