AI data centers spike electricity costs for US manufacturers

Rust Belt manufacturers are getting hammered by soaring electricity bills, thanks to the AI data center boom. A Reuters analysis reveals that factory power costs are rising faster than for other customers, with one Ohio brick maker seeing bills jump from $1,600 to $12,000 monthly. The culprit? PJM Interconnection, the grid operator for 13 states, has hiked capacity prices from $28.92 per megawatt-day in 2024 to $329.17 in 2026 due to data center demand. Steelmakers are hit especially hard—electricity makes up 20-40% of production costs, and Ohio’s Metallus reports a 70% cost spike since 2024. While data centers need about 1 million tons of steel yearly, their energy thirst is eroding profits for the very industries Trump’s ‘Made in America’ plan aims to revive. Why it matters: This tension between AI growth and manufacturing revival exposes a critical policy blind spot—subsidizing tech without securing affordable energy for traditional industry could undermine both agendas.