--- title: "Utilities asked regulators for a record $23.1 billion in rate hikes this year to fund the AI power buildout" description: "Investor-owned utilities asked regulators for a record $4.5 billion in rate increases last quarter, part of $23.1 billion so far this year, to fund a power buildout driven by data centers. In Chicago, judges just recommended a third of what Peoples Gas first asked for." publisher: "The Inference" section: "Power" published: 2026-10-10T19:01:39.567Z modified: 2026-10-10T19:01:39.567Z canonical: https://theinference.org/article/utilities-asked-regulators-for-a-record-23-1-billion-in-rate-hikes-this-year-to-fund-the-ai-power-buildout language: en keywords: "Utilities, Data Centers, Rate Regulation, Energy Costs" --- # Utilities asked regulators for a record $23.1 billion in rate hikes this year to fund the AI power buildout > Investor-owned utilities asked regulators for a record $4.5 billion in rate increases last quarter, part of $23.1 billion so far this year, to fund a power buildout driven by data centers. In Chicago, judges just recommended a third of what Peoples Gas first asked for. ## A $66 million answer to a $202 million ask For more than 898,000 Chicago gas customers, the winter number is $66 million [2]. [Illinois administrative law judges say Peoples Gas may add that to bills next year](https://chicago.suntimes.com/business/2026/10/08/peoples-gas-rate-hike-icc-regulatory-judges-recommendation), down from the $144 million it sought in July and the $202 million it filed for in January [1][2]. The $144 million ask meant $7 to $8 a month on the average home from 2027; the utility has no projection yet for the judges' figure [2]. The Illinois Commerce Commission rules next month [1]. ## The quarter set a record for asking The order landed in the sharpest quarter of asking on record. [PowerLines, an advocacy group](https://powerlines.org/), [counted $4.5 billion of electric and gas requests filed in the third quarter](https://www.utilitydive.com/news/q3-electric-gas-rate-requests-powerlines-analysis/832609/), more than double a year earlier, taking 2026 to $23.1 billion [3][4]. Those filings alone could affect the future bills of 45.5 million customers [4]. The largest single case: [FirstEnergy's Jersey Central Power & Light](https://theinference.org/markets/companies/firstenergy), with $253 million of base distribution increases plus $476 million of deferred storm costs, an 8.8 percent residential bill rise starting in 2028 [3]. [Electricity prices rose 7.3 percent in the year through April](https://gcn.com/rate-increase-requests-utilities-filed-record/22116/), on top of almost 40 percent since 2021 [3][5]. *Chart: **Rate requests more than doubled in 2025; 2026 is close behind with a quarter left** Columns showing annual US utility rate increase requests rising from $15 billion in 2024 to $31 billion in 2025 and $23.1 billion through the third quarter of 2026.* *Annual electric and gas rate increase requests filed by investor-owned utilities, per PowerLines; 2026 covers filings through the third quarter. Sources: Utility Dive, Oct 9, 2026; GCN, Oct 2, 2026. [3][5]* ## One corporate family, both ends of the ledger The money is building the AI era's grid, and one corporate family sits on both ends. [Peoples Gas' parent, WEC Energy Group](https://theinference.org/markets/companies/wec-energy-group), reported a $1.6 billion profit last year [1]; its Wisconsin utility, We Energies, filed an engineering plan last week for the 750-megawatt Fox North Energy Center, the state's seventh gas plant proposal in about two years by environmental groups' count [7]. [A draft state report puts Wisconsin demand up 40 percent by 2032](https://www.wpr.org/news/we-energies-plans-new-750mw-natural-gas-plant-in-fox-valley) on three large data centers, with gas supplying about half the state's power and coal near 3 percent [7]. Whether the new plant serves one directly, the utility has not said [7]. [Dominion](https://theinference.org/markets/companies/dominion-energy) says roughly 68 percent of its $7.59 billion in new transmission through 2031 is driven by data center growth [5]. [The industry plans more than $1.1 trillion of capex through 2029](https://powerlines.org/reports/), and PowerLines counts $1.4 trillion through 2030 [3][6]. Data centers get the megawatts; ratepayers get the mortgage. ## The haircuts are getting deeper Regulators rarely reject outright, but the discounts are deepening [5]. [Xcel Energy](https://theinference.org/markets/companies/xcel-energy) asked Colorado for $356 million and left with $157 million [5]. In Minnesota, [the commission lifted Xcel's allowed return on equity to 9.6 percent from 9.25](https://gcn.com/return-on-equity-minnesota-attorney-general/21981/), worth $34 million to $35 million a year by advocates' count, with an October 19 deadline on the attorney general's bid to reverse it [8]. *Chart: **Peoples Gas asked for $202 million; the judges said $66 million** Bars showing the Peoples Gas rate increase request falling from $202 million filed in January to $144 million in July to a recommended $66 million.* *Stages of the Peoples Gas rate case in Illinois; the judges' figure is an administrative law judges' proposed order pending the ICC's final ruling. Sources: Chicago Sun-Times, Oct 8, 2026; Chicago Tribune via Yahoo News, Oct 7, 2026. [1][2]* The same curve runs through the stocks. A utility earns its allowed return on the infrastructure regulators approve, so a deeper haircut leaves less earning base under a capex-driven growth story [8]. No source quantifies what an ICC-style cut would do to valuations if it spread nationwide; the exposure sits where growth leans on the biggest pending asks. ## Utilities say reliability, voters say affordability The Edison Electric Institute says every rate request gets rigorous review [3]. Peoples Gas quotes the judges' own proposed order in its defense: retiring 1,000 miles of old pipe is "a binding safety mandate," not a discretionary program [1][2]. Both can be true while the politics turns: 74 percent of Wisconsin voters told Marquette pollsters data center costs outweigh the benefits, and energy affordability is on next month's midterm ballot [9][3]. ## November prices the template Watch the size of the cut. [Peoples Gas won $303 million as recently as November 2023](https://www.yahoo.com/news/us/articles/icc-judges-recommend-slashing-proposed-183800773.html), so the margin between the judges' $66 million and the final order matters [2]. The pre-emptive alternative is already visible. Xcel's Minnesota arm [filed October 9 to freeze base electric rates for 2027 and 2028](https://www.tipranks.com/news/company-announcements/xcel-energy-proposes-minnesota-electric-rate-freeze-plan), funded by accelerated battery-storage tax credits instead of a rate case [10]. [Oracle](https://theinference.org/markets/companies/oracle) moved for the same reason, a deep-pocketed customer stepping in front of the bill fight, [committing to absorb about $300 million in rising energy costs at the Point Beach nuclear plant through 2033](https://www.wpr.org/news/oracle-deal-we-energies-utility-customers) [9]. The AI buildout is real. Its financing is the American utility bill, and the bill has started to vote back. ## Takeaway Regulators are approving a record wave of utility rate hikes but cutting them ever deeper, and November's rulings and midterms will price how much of the AI power buildout lands on bills. ## Sources 1. [Chicago Sun-Times, "Peoples Gas rate hike should be cut in half, ICC regulatory judges say," 8 October 2026](https://chicago.suntimes.com/business/2026/10/08/peoples-gas-rate-hike-icc-regulatory-judges-recommendation) 2. [Chicago Tribune via Yahoo News, "ICC judges recommend slashing proposed $144 million Peoples Gas rate increase by more than half," 7 October 2026](https://www.yahoo.com/news/us/articles/icc-judges-recommend-slashing-proposed-183800773.html) 3. [Utility Dive, "US electric, gas utility rate requests spike to $4.5B in Q3: PowerLines," 9 October 2026](https://www.utilitydive.com/news/q3-electric-gas-rate-requests-powerlines-analysis/832609/) 4. [PowerLines, "Utilities Request $23.1 Billion in Rate Increases Through Third Quarter of 2026," 7 October 2026](https://powerlines.org/) 5. [GCN, "US utilities filed a record $9.2 billion in rate increase requests in Q2 2026, with more than 56 million customers facing higher bills," 2 October 2026](https://gcn.com/rate-increase-requests-utilities-filed-record/22116/) 6. [PowerLines, "Reports: Utility Bills Are Rising and Utility Spending is Rising" (capex analysis), accessed 10 October 2026](https://powerlines.org/reports/) 7. [Wisconsin Public Radio, "We Energies plans new 750MW natural gas plant in Fox Valley," 9 October 2026](https://www.wpr.org/news/we-energies-plans-new-750mw-natural-gas-plant-in-fox-valley) 8. [GCN, "Minnesota attorney general and consumer board challenge Xcel Energy's 9.6% return on equity," 27 September 2026](https://gcn.com/return-on-equity-minnesota-attorney-general/21981/) 9. [Wisconsin Public Radio, "Oracle reaches deal with We Energies that's slated to save utility customers $300M," 6 October 2026](https://www.wpr.org/news/oracle-deal-we-energies-utility-customers) 10. [TipRanks, "Xcel Energy Proposes Minnesota Electric Rate Freeze Plan," 9 October 2026](https://www.tipranks.com/news/company-announcements/xcel-energy-proposes-minnesota-electric-rate-freeze-plan) --- Utilities asked regulators for a record $23.1 billion in rate hikes this year to fund the AI power buildout — The Inference. Canonical: https://theinference.org/article/utilities-asked-regulators-for-a-record-23-1-billion-in-rate-hikes-this-year-to-fund-the-ai-power-buildout