Millions of Americans are paying higher electricity bills to help finance power grid upgrades and energy infrastructure projects years before they become operational, according to a Reuters review of regulatory filings.
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As electricity demand surges due to the rapid expansion of artificial intelligence data centers, policymakers across the United States are increasingly allowing utility companies to recover construction costs from customers in advance through a mechanism known as Construction Work In Progress (CWIP).
Traditionally, utilities relied on loans and investor funding for major infrastructure projects and only passed costs on to consumers after completion. However, CWIP policies now permit companies to charge customers during the construction phase, adding several dollars monthly to household electricity bills.
Reuters found that at least 40 US states currently have some form of CWIP incentive, double the number recorded a decade ago. States including Missouri, Arkansas, Kansas, Oklahoma, and North Carolina have recently introduced or expanded such measures to support urgent grid modernization projects.
Supporters argue that the policy helps accelerate infrastructure investment and lowers long-term financing costs. Critics, however, say it shifts financial risks from corporations to consumers, especially for projects that may face delays, cost overruns, or cancellation.
Several major projects have already relied on CWIP financing, including the Vogtle nuclear reactors in Georgia, an offshore wind project in Virginia, and high-voltage transmission developments in Nevada.
Consumer groups warn that rising electricity prices are worsening affordability concerns nationwide. US electricity costs have climbed nearly 40% over the past five years, with significant increases in regions hosting large data center operations.
Industry analysts estimate that US electric utilities will invest more than $1 trillion in infrastructure over the next five years, driven largely by growing power demand from AI technologies and aging grid systems.
