Sen. Bernie Sanders and Rep. Alexandria Ocasio-Cortez want to freeze construction of data centers across the country, claiming the facilities drive up electricity costs for ordinary Americans. A recent study from the Institute for Energy Research says the numbers tell a different story, and in some cases, the exact opposite one.
The two lawmakers announced the AI Data Center Moratorium Act, which would "enact a reasonable pause" on new data center development. Ocasio-Cortez framed AI as posing an "existential harm" to society. The pair demanded that artificial intelligence be developed for the benefit of workers, not what they called "billionaire Big Tech oligarchs," and insisted that data centers should not raise electricity costs for consumers.
It is a familiar playbook. Sanders and Ocasio-Cortez used the same approach to advance the 2019 Green New Deal, big rhetoric, sweeping proposals, and a villain drawn from the private sector. This time the villain is the data center, the physical backbone of everything from cloud storage to AI research.
The IER study examined whether states with more data centers actually have higher electricity rates. It asked three questions: Do states with more data centers have higher rates? Have those states seen faster rate increases over time? And what happens to rates in states where electricity demand is growing versus states where it is shrinking?
On the first two questions, the study found no statistically significant correlation between the number of data centers in a state and high energy costs, and no statistically significant link between data centers and faster electricity-rate increases. The narrative that data centers are spiking your power bill simply did not hold up in the state-level data.
The third question produced the most striking result. Daniel Simmons, an IER fellow and former assistant secretary at the Department of Energy, told Just the News:
"The answer there is maybe the most interesting, because the correlation runs the exact opposite way."
Between 2015 and 2025, states with high growth in electricity demand averaged a 20% increase in electricity rates. States with low growth in demand averaged nearly 40% increases over the same period, roughly double. The pattern held when the study narrowed to 2021 through 2025: high-growth states saw an average rate increase of 16%, while low-growth states saw 28.5%.
The mechanism is straightforward. Utilities carry large fixed costs, transmission lines, substations, generation capacity. When electricity sales grow, those fixed costs spread across more kilowatt-hours, which holds per-unit rates down. When sales stagnate or drop, a shrinking base of ratepayers shoulders the same fixed burden, and rates climb.
The study's state-by-state findings are worth examining. California, Maine, Connecticut, Massachusetts, and Hawaii posted some of the largest declines in electricity sales. These are not states overrun by data centers. They are states where demand has fallen, and where ratepayers have watched their bills climb anyway.
Meanwhile, states like North Dakota, New Mexico, Oregon, and Virginia, some of which have seen among the highest increases in electricity sales, enjoy comparatively low rates. Virginia and Texas are home to some of the largest growth in data centers in the country, yet their ratepayers are not suffering the cost spikes Sanders and Ocasio-Cortez describe.
Simmons pointed specifically to California. The state's energy troubles are well documented, and they have nothing to do with data centers crowding the grid.
"California is in a tough place. They put themselves in a tough place."
That is a polite way of saying California's policy choices, aggressive renewable mandates, restricted generation capacity, and regulatory friction, created the rate pressures its residents face. Blaming data centers for problems rooted in decades of energy-policy decisions is convenient. It is not accurate.
Sanders and Ocasio-Cortez are not alone in their concerns. Many communities have pushed back against data center construction, and states including Georgia and Florida are considering legislation aimed at preventing data center growth from raising electricity rates. The political anxiety is real, even if the economic evidence does not support it.
But a federal moratorium is a different animal than state-level guardrails. Freezing data center construction nationwide would affect the infrastructure behind services Americans use every day. Simmons made the point plainly:
"I just received some emails. That's all in data centers. When you take pictures on your phones, those pictures get uploaded to data centers."
The proposal also arrives at a moment when the United States is competing globally in artificial intelligence, a race with enormous economic and national-security stakes. A moratorium would hand an advantage to every country that keeps building while America pauses. Sanders and Ocasio-Cortez frame their bill as protecting workers and consumers. The practical effect would be to slow the sector that is generating some of the most significant private investment in American infrastructure in a generation.
This is not the first time Ocasio-Cortez's policy ambitions have drawn scrutiny alongside questions about how she manages resources closer to home. Her campaign has faced questions about nearly $19,000 funneled to a psychiatrist linked to hallucinogenic treatments, raising eyebrows about the gap between populist branding and personal spending decisions.
Simmons was direct about what the data actually shows:
"This is just saying what things are like right now. For people now to point to data centers and say that they are the cause of high electricity rates, that is just completely and utterly wrong."
That is not a political opinion. It is a reading of state-level electricity data over a decade. The correlation between data center presence and high rates does not exist in the numbers. The correlation between declining demand and rising rates does.
Sanders and Ocasio-Cortez have built careers on identifying a corporate villain, proposing sweeping federal intervention, and framing any opposition as siding with the powerful against the people. It is effective messaging. It is also, in this case, contradicted by the available evidence.
The pair's track record on spending credibility has its own complications. Both lawmakers have faced scrutiny over campaign spending on private jets, a detail that sits uneasily alongside populist rhetoric about protecting working families from corporate excess.
Ocasio-Cortez's brand as a champion of the working class has also bumped against revelations about celebrity glam squad bills paid by donors. None of this disqualifies her from proposing legislation. But it does invite fair questions about whether the populist framing matches the record.
The moratorium bill also echoes the approach of the Green New Deal, a proposal long on ambition and short on economic grounding. Both efforts share a common assumption: that the federal government should override market signals and halt private-sector activity based on projections that the available data does not support.
A watchdog complaint about Ocasio-Cortez's campaign fund management only adds to a broader pattern of disconnect between the lawmaker's public posture and her operational track record.
Simmons offered a simple caution that applies well beyond the data center debate:
"Let's not throw the baby out with the bath water, in terms of AI or other types of data centers, because they help us with a whole lot of stuff that we really like."
The bill's formal title, the AI Data Center Moratorium Act, suggests precision. But the proposal's scope, freezing development of data center facilities nationwide, is anything but precise. It would affect every company building or expanding the infrastructure that powers cloud computing, AI research, medical data processing, financial systems, and the everyday digital services Americans rely on without thinking twice.
States like Virginia and Texas, which have welcomed data center investment and seen their ratepayers benefit from growing demand, would be punished for their success. States like California, where policy choices have already driven up costs and driven down demand, would gain nothing, because their problems have nothing to do with data centers in the first place.
The IER study does not claim data centers pose zero challenges. Local infrastructure, water use, and grid planning are legitimate concerns that states and communities can address. But the central claim behind the Sanders-Ocasio-Cortez bill, that data centers are driving up electricity costs, is flatly contradicted by a decade of state-level data.
When the facts run the exact opposite way from the premise of your legislation, the honest move is to go back to the drawing board. The political move is to keep talking about "billionaire Big Tech oligarchs" and hope nobody checks the numbers.
