Data Centers vs Green Energy: The Race That’s Driving Clevelanders' Electric Bill Up

In Northeast Ohio, there has been a surge in data centers, with 24 of them located in the Greater Cleveland area alone. With some of them taking over office spaces in Downtown Cleveland, they’re now draining the grid that powers the region's homes and businesses, passing the cost to everyone, all in the name of powering the digital world we live in.

Data centers, and not just those of artificial intelligence, are increasing all over the country to help power our ability to use social media, talk to our coworkers on Teams or Slack and now use AI apps like ChatGPT, Google’s Gemini and Microsoft's Co-Pilot.

Inside these data centers are hundreds to thousands of servers, with the average data center housing around 2,000 to 5,000, according to the Pew Research Center. The servers need two things: electricity to run them and water to keep them cool. As future microgrids expand in the area, they might be able to mitigate the effects of the data centers on Ohio's main electrical grid.

Midsize data centers (20,000-100,000 square feet) can use about 10-70 megawatts of electricity, while larger data centers (over 100,000 square feet) use up to 200 megawatts. To put that all in perspective, one megawatt-hour can power an electric car for roughly 3,600 miles. If 10 megawatts were consumed for just one hour, that energy alone could drive an EV car from Cleveland to Los Angeles and back roughly seven times. Scale that to 200 megawatt-hours, and you’d have enough electricity to circle the Earth nearly 29 times in an electric car.

When you add them all up, U.S. data centers have accounted for roughly 4.4% of the nation’s electricity consumption in recent years. Industry and government forecasts suggest that the share could climb into the 6.7-12% range in the near future, a rise that could nearly triple the sector’s power demand.

That consumption is now being passed down to residents. In fact, more than half of your electric bill reflects the cost of generating electricity from raw materials and whether power plants have the capacity to meet a state’s demand.

In Ohio, PJM Interconnection manages the grid powering the area and is seeing ever-increasing demand driven by data centers. 

That’s because, among the 13 states it covers, Virginia and Ohio are the first- and fifth-largest markets for data centers, respectively. Between Virginia and Ohio, almost 900 data centers could be tapped into the grid.

The Pennsylvania-based company allows power plants to bid on the cost of providing the state's electricity. The last two capacity auctions managed by PJM set record highs, which is helping drive up your electric bill this year, and the latest results suggest bills could rise a further 1.5% to 5% next year. These auctions have seen unprecedented growth in their winning bids over the last three years.

• 2025: $16.1 billion

• 2024: $14.7 billion

• 2023: $2.2 billion

Ohioans and Clevelanders have expressed significant concern over rising electric bills, and Cuyahoga County Executive Chris Ronayne understands the issue, having seen his own bill rise. He says that paying more for electricity leaves residents with less money in their wallets for food and other life essentials. 

"Utility bills are a layer in the stack of monthly expenses for any resident,” Ronayne says. “And as utility bills rise, that potentially makes (individuals) more food and housing insecure. So it's a cascading effect."

Nothing is uncertain for PJM and its voting members, which include private utilities, power plants and transmission line companies. PJM is responsible for building new power plants, retiring older ones and coordinating who and how power flows through the grid in Ohio and the 13 other states. 

Its voting members are seeing record profits. For example, FirstEnergy Corp. Northeast Ohio subsidiaries have affiliate memberships on PJM; they have voting rights only at senior task force meetings and lower-level committee meetings. Monongahela Power Company, owned by FirstEnergy, is a full voting member on PJM, meaning it participates in the competitive wholesale electricity market.

Also owned by FirstEnergy are the Illuminating Company and Ohio Edison, which together serve over 1.7 million customers in Northeast and North Central Ohio. FirstEnergy reported a gross profit of $9.6 million in 2024. In 2021, its gross profit was around $7.7 million.

Microgrids might be Cuyahoga County’s secret weapon, not because most of the system is underground, but because their ability to be placed throughout the county will help drive down electric bills by generating renewable energy that can be used or stored during times of high demand or when the main grid falters. However, it could be years before they make a real impact.

“We are taking steps before we run,” Ronayne says.

The county established Cuyahoga Green Energy in 2021, a public energy company, to develop renewable energy projects, such as solar arrays and microgrids, that can help stabilize costs and reduce households' energy burden.

“The name of the game is resilient power, choice in energy,” Ronayne says. “Keeping costs low because of competition and ultimately the microgrids and the individual home solar retrofits can help bring down the whole cost of energy.”

Cuyahoga Green Energy is the first new county utility in the country in over 75 years. Through its microgrids, it will help put more electrons (megawatts) on the grid and help its residents and local companies have cheaper electric bills. 

Microgrids are local and most of the time are self-sufficient; their power lines are typically buried underground and may include solar panels, gas generators and large batteries to store power. They can tap into the main grid to draw power and then disconnect when needed to keep the sites powered, without interruption. Unlike traditional microgrids that serve a couple of sites or individual locations, Cuyahoga Green Energy designed its systems to serve multiple interconnected sites. 

When they are not connected to the main grid and are generating their own megawatts, microgrids can reduce the three factors that drive Clevelanders' electric bills. Generation, transmission and distribution can all be done on the microgrid system when not connected to the main grid. 

"Any kind of (local) new electrons on the grid are going to help relieve that pressure and eventually help to stabilize costs,” Jenita McGowan, Cuyahoga County chief of climate and sustainability, told Cleveland Magazine. “And so even if it's a commercial microgrid, it helps the grid as a whole relieve those (factors) that are creating this high cost situation."

Right now, Cuyahoga Green Energy has no operational microgrids. Their first microgrid, the Euclid microgrid, will begin construction in 2027 and take about a year to complete. Once complete, it will generate 5 megawatts.

Cuyahoga Green Energy has operated a solar site at a Brooklyn landfill since 2018. A planned expansion at the site is expected to increase generation up to 4 to 10 megawatts. That is enough to power roughly 2,000 homes for an entire year.

Cuyahoga had 615,825 housing units according to the 2020 census. Overall, electric consumers use about 4777.41% of the power generated by the county. 

If 10 megawatts can power 2,000 homes for a year, the county would need to generate over 3,000 megawatts to power all 615,825 housing units independently. 

The most extensive project to help generate electrons is happening in the city of Painesville. The plan is to take down a coal-fired plant built in the 1880s at a landfill site and install a solar array capable of producing up to 35 megawatts by 2027. 

For Cuyahoga Green Energy, their current microgrid plans primarily involve serving commercial and industrial customers. Future projects include vital community facilities, like fire departments, grocery stores and schools.

Since these microgrids are still years away, Ohioans have limited options for lowering their bills right now. They can shop for a cheaper supplier or see whether their community is buying electricity in bulk, a system known as aggregation.

Residents can also band together and explore the solar co-op offered by Cuyahoga Green Energy. In doing so, they will be able to buy and install solar panels at a discounted price, which will also help lower their electric bill. 

“We've got a residential co-op under Cuyahoga Green Energy that continues to help our residents retrofit solar on the rooftops,” Ronayne says, “Here in Cuyahoga County, we've got 91 installations going and we hope by the end of 2025 to bring that total number (up to 500)."

Even with these options available, the electrical situation is expected to worsen as Northeast Ohio is poised for a data center expansion. There are rumors that the IX Center will become a data center, and that Bedrock is trying to attract one to take over the top floors of the Higbee building. 

This comes as no surprise, as Ohio offers two compelling reasons for data centers to locate here. In Northeast Ohio, the Great Lakes have massive amounts of water to tap for cooling their servers, which is threatening to drain the lakes. The other is that Ohio offers a full or partial exemption from the state’s 5.75% tax on large data centers, provided state officials approve the exemption. 

Signal Ohio reported that Ohio will waive about $127 million in taxes for data centers in 2025. This does not include any local tax breaks that counties and municipalities may also offer to data centers.

Some relief is coming to the grid, though. This July, the Public Utilities Commission of Ohio (PUCO) issued a ruling requiring any new large data centers in AEP Ohio’s territory to pay for at least 85% of the energy they are contracted to use, meaning the data center still has to pay for energy even if it doesn’t use it.

Older data centers are grandfathered from this ruling. The plan for this tariff is also to help pay for the infrastructure that is needed to power the data centers. PJM’s independent monitor, Monitoring Analytics, is asking regulators to direct PJM to only add new data centers to the grid when infrastructure is in place to serve them and existing consumers. 

The PUCO ruling and possibly future regulation from Ohio or the federal government, along with help for the main grid, such as Cuyahoga’s microgrids, could be years away from having a real impact.

"I think the operative of the day is work together and with the ultimate goal of making sure we have appropriate infrastructure to live in the digital world we live in,” Ronayne says. “But making sure that it isn't happening in a way that is costing our residents too much on their energy bills."

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