By Sabrina Shankman

Boston Globe

Have you used AI today? Or, more likely: How many times have you used AI today?

Whether it’s ChatGPT or a simple Google search, AI is getting faster, more pervasive, and harder to avoid. And all that comes with a cost. Data processing of this magnitude requires a staggering amount of electricity, at a time when households in Massachusetts are already reeling from high utility bills and the state is trying to wean itself off fossil fuels to combat climate change.

As Massachusetts prepares for an anticipated boom in new data centers — warehouse sized rooms with rows and rows of densely packed servers and cooling systems — the questions are piling up: Just where will all that electricity come from? Can Massachusetts add enough solar panels and wind turbines, or will it have to fall back on fossil fuels that contribute to global warming? Can the electric grid, already tasked with the switch to electric heat pumps and electric vehicles, shoulder all this new demand?

And maybe most important for consumers, could the surge in demand drive up electricity bills, which already are among the highest in the nation?

“I have major concerns about data centers,” said Kyle Murray, Massachusetts program director for the advocacy group the Acadia Center. In other parts of the country, where data centers are being rapidly built, he said, “they just end up driving up costs for everyone else — they get a favorable rate, and then average citizens end up paying more."

Massachusetts has yet to experience a data center boom — certainly not compared to Virginia, for example, where energy demand from hundreds of data centers already accounts for one-quarter of that state’s electricity consumption.

But that’s poised to change, as demand for data generation increases and developers look to take advantage of the state’s new, friendlier business policies, including an exemption to “sales and use” taxes for data centers passed last year.

A firm count of prospective new data centers is hard to come by. But, so far, Massachusetts’ investor-owned utilities, including Eversource and National Grid, have received requests from proposed data centers for an additional 2 gigawatts of electricity, according to state officials. When operating at full capacity, that’s equivalent to the annual electricity usage of 2.4 million Massachusetts households — or 85 percent of all households in the state.

What’s more, that forecast doesn’t include projects proposed in areas served by smaller, municipally owned utilities, such as an expansive data center planned for Westfield that is estimated to cost more than $3 billion at full buildout. The developer is reportedly in talks with Westfield Gas & Electric for a contract with below-market electric rates.

At that size, the data center would be a massive boon for Westfield, generating some $400 million in property tax revenue and 500 permanent jobs, from data managers to security and cleaners, as well as 1,500 construction jobs during the 18-year buildout.

For now, Massachusetts has a small footprint of data centers compared to other states, with just 44, according to DC Byte, a leading researcher in the field.

Combined, those data centers draw about 188 megawatts of power, less than 6 percent of what could be needed. Most of the current centers are not in stand-alone buildings but rather share space with retail centers or other commercial uses.

In 2024, Governor Maura Healey launched an effort to make Massachusetts a national leader in AI innovation. With $100 million in taxpayer money from an economic development bill, plans call for a statewide AI Hub in collaboration with industry players, startups, and academia. In May, she announced another $31 million in state investments.

Developers “can’t put everything in Maryland or everything in Texas or everything in Minnesota,” said Jeff Daley, president of the Westmass Area Development Corp. Data centers need to be near population centers, to assure fast delivery speeds, and ideally close to existing fiber optic infrastructure. So it makes sense to build more of them in New England, Daley said. “I think Massachusetts is primed for that.”

Adam Post, a senior vice president at data center developer CoreSite, said the company builds based partly on what local utilities can provide, but also on what its customers want in a new center. Sometimes that means asking for a higher mix of renewables from utilities, or having additional generation onsite to supplement the energy supply.

Last year, when City Councilors in Denver raised questions about the water and energy use of a planned data center there, CoreSite announced it would not pursue a $9 million tax break from the city.

For now, Post said CoreSite is not considering building any new centers in Massachusetts, but may expand some of its existing ones.

Ironically, the one thing that may deter more data centers from coming here is the cost of electricity in Massachusetts. Jenny Gerson, senior director of sustainability at DataBank, said high rates are a reason why DataBank hasn’t expanded beyond the one data center it has in Massachusetts.

“As we look to expand our data center portfolio, electricity rates factor among our considerations,” Gerson said, suggesting various interests here should “come together to sort out the best way to move forward” as other states with data center booms have had to do.

The potential economic opportunity — as well as the downsides associated with increased energy demand— aren’t lost on the state.

“If we get this right, there are a lot of benefits across the board, and a lot of boxes that could be checked,” said Josh Ryor, assistant secretary of the Executive Office of Energy and Environmental Affairs.

And if it isn’t done right, ratepayers — and the climate — could pay the price.

The 2 gigawatts of additional electricity forecasted would cost roughly $1 billion in upgrades to the energy grid, Ryor said, and those costs would be borne by ratepayers.

Realistically, though, only a fraction of those data centers will be built in coming years. But with demand for electricity already rising as Massachusetts residents increasingly turn to electric heat pumps and electric vehicles, any added demand could require costly upgrades to the wires and substations needed to power the state.

Still, data centers that do get built in the near term would likely be largely powered by Massachusetts’ most readily available resource: natural gas power plants, which the state has been working to phase out due to the climate-warming methane emissions from gas.

Moreover, it’s getting harder to bring new clean energy onto the power grid thanks to changes from the Trump administration, such as a pause in leasing offshore wind farms and a proposed rollback of tax incentives for wind turbines and solar panels, said Joseph Curtatone, president of the Alliance for Climate Transition, a nonprofit clean energy business association.

“Without wind and renewables — which account now for 11 percent of power generations — AI and data centers are really going to put a strain on our system as a whole," he said.

The state is largely on its own to solve the challenge, and so is working on two somewhat competing tracks: wooing new data centers while also seeking to avoid pitfalls other states have experienced. In Maryland and Virginia, for instance, ratepayers are footing the bill for a $5 billion upgrade to transmission lines to accommodate data centers. Elsewhere, fossil-fuel power plants that were supposed to retire are instead staying online.

One possibility, Ryor said, is to require developers to supply their own energy generation, such as solar and battery storage on site.

Johanna Neumann, senior director of Environment America’s campaign for 100 percent renewable energy, said there’s an argument to be made that the cost of upgrades to the power grid “should be covered by the owner of the data center rather than being socialized across the rate base.”

Requiring data centers to invest in more onsite energy sources could also help resolve another perennial problem in Massachusetts: a peak in demand during the winter that causes prices to spike, said Digaunto Chatterjee, senior vice president of engineering and system planning at Eversource. If utilities could work with data centers to tap into their energy sources in times of extreme energy use in the state, it could take the edge off those spikes.

“So there are solutions we can all work toward,” Chatterjee said.

Right now, the challenge for the state is to thread the needle: create policies that will lead to more clean energy that won’t saddle ratepayers with expensive upgrade costs, but also won’t drive developers to other states with less onerous requirements.

“There’s cost and benefits,” said Ryor. “So we’re really looking for ways to figure out how to balance both. If we can figure that out, I think we’d really be a national leader on this.”

Neena Hagen of the Globe staff contributed to this report.

Sabrina Shankman can be reached at sabrina.shankman@globe.com.