Editorial: Meeting needs for data centers, fair power rates

Published 1:30 am Thursday, January 15, 2026

By The Herald Editorial Board

In a small way, every time you use artificial intelligence — such as an AI assistant for an internet search, or an AI app on your phone, such as ChatGPT or Grok — you may be adding to your power bill.

Admittedly, that’s a simplistic way of looking at the ties between AI and what you’re paying for electricity, but consider:

Those AI tools require stunning amounts of computing power, which has driven a boom in the construction of data centers; large complexes of computer servers and equipment that in addition to requiring a lot of land also are thirsty for electricity to power their advanced chips and water to cool the server farms.

For example, a typical center drawing 100 megawatts of power would over a year consume about 613,200 megawatt hours of electricity, an amount similar to what 56,000 homes would use in a year. To cool those servers, that same 100 MW center would also use 100 million gallons of water, about what 25,000 people would use in a year.

And as demand for electricity increases, so does what your utility charges.

While the pace of construction of data centers in Washington state has slowed recently as compared with other states, Washington has more than 130 data centers, ranking 10th among U.S. states, according to a report on data centers by a pro-technology advocacy group.

At the same time — perhaps surprisingly, considering the state’s efforts to encourage clean energy development — a report last May by Oregon Public Broadcasting and ProPublica found that projects for clean-energy generation and electrical transmission are lagging in the Pacific Northwest, with Washington state ranking 50th in the percentage of growth in production of power from wind, solar, hydroelectric and other clean-energy sources, while Oregon ranks 47th.

Yes, the Trump administration has been a considerable drag on development of clean energy, especially in states with majority Democratic control. Last fall, the administration canceled $7.6 billion for clean energy projects in 16 states — including $1.1 billion in Washington — all of which where majorities of voters had backed the Democratic ticket in the 2024 presidential election.

But also dragging its feet has been the federal Bonneville Power Administration, which runs the regions’ hydroelectric dams, and also is responsible for much of the electrical grid, determining which energy projects can hook up to provide juice to power lines.

The result: Washington has seen only slow progress on a backlog of energy projects. A report this year by Clean and Prosperous, a clean energy advocate, counted more than 250 clean energy projects that have been delayed, totaling more than $149 billion in suspended economic activity and representing more than 580,000 jobs; projects that could boost the supply of clean power and better moderate electricity costs, regardless of data center projects.

It’s not that solutions aren’t available, even facing a federal government that insists the climate crisis is a hoax and touts the oxymoron of “clean coal,” to the point of ordering a power plant in Centralia to continue to burn coal in violation of a long-agreed settlement that was to convert the plant to natural gas this year.

In one of his early initiatives last year, Gov. Bob Ferguson established a work group to guide the further development of data centers in the state. That effort released a preliminary report in November that further focused on the issue and announced several recommendations.

As to the impact that data centers could pose for the state, the report cited figures from the Northwest Power and Conservation Council, which forecasts energy demand, projecting that data centers and chip fabrication could add 2,200 average megawatts of electrical load as soon as 2030, equivalent to the power demands for more than 1.2 million additional homes.

The work group’s preliminary report makes several recommendations, setting priorities for state lawmakers, officials and agencies, including:

• Maintaining the integrity of the state’s climate laws.

• Strengthening ratepayer protections.

• Protecting community, Tribal and environmental resources.

• Improving energy resource forecasting.

• Enhancing transmission capacity and encouraging flexibility of power use to improving energy efficiency.

• Accelerating the siting and permitting of clean energy generation and the transmission grid.

• Accelerating the deployment of existing and emerging technologies, such as geothermal, green fuels, long-duration batteries and nuclear energy to power data centers.

At the same time, at least one of the tech industry’s leaders — Redmond-based Microsoft — has announced its own commitment to what it calls “community-first AI structure,” pledging to “pay its way” for its data center projects by telling utilities to charge the company rates that assure it is covering the cost of the power it uses.

Microsoft also is pledging to minimize its water use by recycling and replenishing the water. As well, it’s promising to invest in AI training in communities, create jobs for communities and won’t ask local governments to reduce property tax rates to secure the centers.

Conscious of their power demands, Microsoft, Amazon and Google last year announced deals to invest in nuclear energy projects that could provide some of their electrical needs. Microsoft, for example, has signed contracts with an effort to restart the nuclear generators at Three Mile Island near Middletown, Pa.

(Some among clean energy supporters will balk at nuclear power sources, but the growing climate crisis calls for consideration of all non-carbon-emitting technologies.)

Those are laudable moves, but they should be joined by regulation and reporting requirements that hold AI and technology companies to those commitments, especially those that aren’t as community minded as Microsoft.

One suggestion considered but not accepted by the data center work group would have allowed the continuation of sales-and-use tax breaks as incentives to encourage the construction of data centers in communities where the centers could provide jobs and economic benefits, but under the condition that the data centers would be responsible for providing their own source of clean power.

Such tax incentives have long provided a carrot for industry. It’s just the stick that’s missing.

The governor, as part of his supplemental budget proposal, has requested an end of a 6.5 percent sales tax break on replacement computer server equipment, which is projected to bring in $203.5 million to the state general fund between 2027 and 2029.

While no longer part of the work group’s recommendation, that doesn’t make the issue of incentives off-limits for discussion by lawmakers on how to condition those incentives to encourage growth in the state’s power supply while also drawing from clean energy sources.

With a backlog of clean energy projects available and growing demand for electricity, Washington state needs to move on policy and investments that assure fair rates for consumers, a thriving technology industry and clean energy for both.