As energy demand across the US grows, energy costs are rising in all major markets. We continue to see the same concern repeatedly no matter if it is New England, New York, Illinois, or Texas. Increased grid reliability costs! The cost to maintain the grid and meet demand needs is rapidly growing and is starting to become a more significant piece of an energy bill than it was just a couple of years ago. There are no signs of this going away or slowing down as we continue to drive towards electrification with heat pump technology, electric cars, and data center build outs.  

There is no other region with greater concern than Texas. As Texas drives to become the data center capital of the US, electric demand is expected to rise 5 times its new current peak record. This past summer Texas surpassed the record of 85 GW established in 2023, with a peak demand of 91.1 GW. With over 1,800 proposed data center projects, the demand is estimated to exceed 474 GW of potential demand.  

But what is the impact on regional hospitals all over the state? 

Hospitals are already dealing with limited resources and funds, leading to less staffing, longer hours, and insufficient pay in many cases. These grid reliability costs and insufficient market conditions are simply going to create additional strain to already suffering industry. TX electric rates have gone up nearly 100% over the last 5 years. While many hospitals are used to paying .03-.04 per kwh for supply, the new normal is about .06 per kwh. Further strain on the grid will drive supply rates up further and create further limited resources for those in need. There is no limit to what level Texas electric rates could reach in the next few years as the data center boom takes place. 

What can hospitals do to protect themselves? 

• Manage their energy with a third-party consultant 

• Take efficiency measures and put sustainability goals in place 

• Take part in Demand Response Programs 

• Consider additional on-site generation