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Rising bills complicate efforts to modernize the Midwest's electric grid
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A Lee Enterprises, Incorporated newspaper. Majority shareholder: David Hoffmann, Hoffmann Media Group.
Rising bills complicate efforts to modernize the Midwest's electric grid
- Daniel Wheaton Midwest Newsroom
- Oct 25, 2026
- 8 hrs ago
- 0
1 of 2

Nationwide, utilities have requested $18.6 billion in rate increases so far in 2026, according to a report from PowerLines. The Midwest represents about $3 billion of that cost, affecting more than 14 million customers.
- Kenneth Ferriera

The Omaha Public Power District's North Omaha coal plant at 7475 John J. Pershing Drive. The transition from coal-dominated generation to a mix that includes natural gas, wind, solar and battery storage has made power grid operations more complex.
- CHRIS MACHIAN, OMAHA WORLD-HERALD file photo
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Daniel Wheaton Midwest Newsroom
Rising electricity demand from manufacturing and data centers could present a once-in-a-generation opportunity to modernize the electric grid, but rising electricity bills might make such investments politically unpopular.
“This is not a sexy topic,” said Charles Hua, executive director of PowerLines, a national energy consumer education nonprofit. “But it is so important in terms of just how powerful our grid is in empowering our modern economy, and just how dependent we all are on electricity.”
Midwestern states have long benefited from lower energy bills than other regions due to public investments made in the first half of the 20th century and the availability of wind and solar energy. However, extreme heat and severe weather pose a consistent threat to the grid, which can be expensive to fix.
Anger toward data center development has drawn more attention to how the grid serves users, which advocates hope turns into an opportunity to both increase the supply of electricity and keep rates affordable.
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The way the electric grid is managed is designed to be abstract. Utilities determine rates under the purview of public utility commissions, and utilities work with regional transmission organizations to transfer electricity across states. The literal electric grid, the poles, wires, substations and transformers, is built on infrastructure that first lit up Manhattan in 1882, so decisions made generations ago have ripple effects today.
Nationwide, utilities have requested $18.6 billion in rate increases so far in 2026, according to a report from PowerLines. The Midwest represents about $3 billion of that cost, affecting more than 14 million customers.
Lincoln Electric System has approved a proposed 4.5% residential increase for 2027. It is pending City Council approval. Power costs and transmission accounted for most of the operating budget's overall increase. Net power costs are up $28.8 million, or about 19%, according to LES
PowerLines conducted a poll with Ipsos in March. Among Midwestern respondents, 73% said they noticed higher energy bills than last year, and 78% want elected officials to take action.
Other findings included:
• 41% are most frustrated by their lack of choice in utility provider, and 39% are most frustrated by month-to-month fluctuations.
• 30% believe their utility offers them the most affordable rates possible.
• 30% believe their state government does a good job protecting their interests when it comes to utility affordability.
• 82% feel powerless to control how much they are charged for utilities.
• 62% say utility bills add to their financial stress.
• 38% understand what drives the costs of their utility bill.
“The reality is that our grid and our utility regulatory system surrounding it has been really relatively unchanged since it started over 100 years ago,” Hua said. “I think it does raise the question of whether that century-old model is still working for us.”
Improving infrastructure to meet energy needs could cost about $1.4 trillion, Hua said, equivalent to building 2,000 Hoover Dams.
Uneven demand
Changes to your electric bill are due to a confluence of national, regional and local factors, as well as decisions by your utility company. This makes diagnosing a rate hike complicated.
Nationwide, retail energy prices are up by more than 30% since 2019. However, most of that growth is due to damage to infrastructure causing increased rates in California and on the East Coast. Prices have generally tracked inflation, and real prices are down in a majority of states.
“But one of the big challenges that we’re seeing emerge is that for a lot of folks, electricity prices are too expensive,” Hua said. “Their utility bills are going up and up and up, and they don’t necessarily know why.”
One major factor is the rapidly aging grid, which is increasingly vulnerable to storms that cause expensive damage.
The Lawrence Berkeley National Laboratory routinely analyzes trends in electricity prices. One of the study’s co-authors, Ryan Hledik, said the nation is at a crossroads.
“This is not a time for panic, but is definitely a time for us to be acting,” Hledik said.
With energy demand increasing yearly, supply-side decisions will eventually affect costs.
“There are two potentially very divergent outcomes,” Hledik said. “If we don’t put the right policies and customer protections in place, it is possible that we will see electricity rates increase even faster than they have over the last five years. But if we have the right policies and programs in place, it is actually a big opportunity to address the energy affordability challenge.”
The supply chains needed for grid updates have not fully recovered from COVID-era disruptions, making it difficult for utilities to quickly install new equipment.
Most Midwestern utilities are investor-owned and accountable to shareholders. Nebraska is an exception, as it is the nation’s only state served entirely by publicly owned utilities.
Generally, utilities spread the cost of infrastructure upgrades over several years, but those increases hit low-income and fixed-income residents the hardest, Hledik said.
With public scrutiny comes demand for more information.
“I suspect there’s going to be more burden of proof of the necessity of those investments that utilities will need to provide,” Hledik said.
Rising costs
Midwestern states are increasingly attracting data center investments because of available land. Pew Research found the Midwest and South are expected to see the most data center investment in the coming years.
Adding a data center increases a utility’s electricity demand and may require additional infrastructure.
Rate hikes rarely happen quickly because utilities must justify increases to public utility commissions.
Jacob Montgomery, a political science professor at Washington University in St. Louis, said concerns about utility rates cut across party lines.
The Google data center at North 56th Street and Interstate 80 in February. Data center demand, severe weather and the aging grid are forcing utilities to drive up electricity rates.
ARTHUR H. TRICKETT-WILE, Journal Star file photo
“On the left, there’s concerns about the environment, water, energy, climate,” Montgomery said. “On the right, it’s about property rights and local control and utility bills.”
Several Nebraska counties have approved data center moratoriums, and Gov. Jim Pillen has limited certain tax incentives for data centers.
“My hope is that some of the moratoriums that we’re seeing right now are a deliberate pause to say, ‘Let’s figure this out and make sure we’re getting it right,’” Hledik said.
St. Louis Public Radio reported that Ameren Missouri plans to ramp up power plant construction to meet future data center demand.
James Owen, executive director of Renew Missouri, said increased generation inevitably raises costs.
“Any time electric utilities build more generation, it’s going to increase rates,” Owen said. “The main thing driving energy consumption right now is data centers.”
Powering the plans
Regional transmission organizations move electricity across state lines and international borders.
A federal study updated this summer found that more than 4,000 miles of power lines will need replacement in coming decades.
The Midcontinent Independent System Operator (MISO), which covers 15 states and Manitoba, expects to add 15 gigawatts of summer capacity each year over the next five years.
MISO spokesperson McKenzie Barbknecht said the transition from coal-dominated generation to a mix that includes natural gas, wind, solar and battery storage has made grid operations more complex.
“When a heat wave or a natural disaster occurs, MISO can divert power to different areas to meet demand,” she said.
To the west, the Southwest Power Pool (SPP) manages power for 20 million customers across 17 states.
“Our marketplace allows us to move that power around the grid where it’s needed, such that it levelizes prices regionally,” said Sunny Raheem, SPP’s director of system planning.
Manufacturing growth has increased baseline electricity demand across the region, Raheem said.
Building supply
Technology companies and utilities have begun partnering on projects intended to offset future rate increases.
In September, Pacific Gas & Electric announced a partnership to create a “virtual power plant,” a network of batteries and energy storage resources that can add power during periods of high demand.
“As demand scales, our current electricity grid can bridge the gap if we optimize it correctly,” said Amanda Peterson Corio, Google’s global head of energy and power.
Nuclear energy is also returning to the conversation. TerraPower is considering Kansas for a new reactor, and efforts are underway to restart Iowa’s Duane Arnold nuclear plant.
At the same time, some scientists and environmental advocates continue pushing for greater investment in renewable energy rather than fossil fuels.
The Midwest Newsroom is an enterprise journalism collaboration that includes Iowa Public Radio , KCUR , Nebraska Public Media , St. Louis Public Radio and NPR.
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Nationwide, utilities have requested $18.6 billion in rate increases so far in 2026, according to a report from PowerLines. The Midwest represents about $3 billion of that cost, affecting more than 14 million customers.
- Kenneth Ferriera
The Google data center at North 56th Street and Interstate 80 in February. Data center demand, severe weather and the aging grid are forcing utilities to drive up electricity rates.
- ARTHUR H. TRICKETT-WILE, Journal Star file photo
The Omaha Public Power District's North Omaha coal plant at 7475 John J. Pershing Drive. The transition from coal-dominated generation to a mix that includes natural gas, wind, solar and battery storage has made power grid operations more complex.
- CHRIS MACHIAN, OMAHA WORLD-HERALD file photo
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