This piece was initially published in the MS Biz Journal.

With the AI and data boom underway, electricity has become the top economic infrastructure for growth. Electricity has long been foundational to our society, powering our homes and businesses, but now, it is the primary infrastructure on which the digital economy, advanced manufacturing and an American industrial resurgence depend.

In an era of data centers, AI, and electrified production, the ability to generate and deliver large quantities of reliable power is quickly becoming the difference between regions that grow and those that struggle.

The unprecedented electricity demand growth rate has critics claiming electricity bill increases will be the result of it all. Such claims ignore how electric systems trended prior to 2020, especially in Mississippi. From 2000 to 2020, U.S. electricity consumption only increased 11%, and in Mississippi, the growth was only about half that. Over the next 10 years, U.S. electricity demand growth is projected at an astronomical 40%.

Electricity is a capital-intensive business. When we pay for kilowatt hours, what we’re actually paying for is the vast infrastructure required to make and deliver it—generation plants, high-voltage transmission lines, substations, local distribution lines, transformers and a specialized workforce. A system is built for growth, so when there is little or no growth in sales of kilowatt hours, those same kilowatt hours, or us consumers, must bear the increasing costs of maintenance and replacement.

That’s why data centers can be ideal additions to an electric system and good for the other customers on the system. When more electricity is flowing over the same lines, the fixed costs of the entire system are now spread over many more kilowatt hours, just by adding one or several large customers.

That’s precisely what’s happening with Mississippi Power Company serving the Compass Data Center under construction in Meridian. Compass will be consuming surplus electric capacity already available on Mississippi Power’s system. By picking up such a large-load customer in Compass, existing Mississippi Power customers will benefit in the future as costs are spread over more kilowatt hours.

>>>READ: AI can lower energy bills with data centers that power themselves

In the case of Amazon Web Services’ (AWS) multiple campuses in Canton, Ridgeland, Clinton and Vicksburg and AVAIO in Brandon, all within Entergy Mississippi’s service area, there are unprecedented infrastructure additions underway to meet the new capacity needs but still to the benefit of other customers on the system.

Three new natural gas generating plants are being in Greenville, Ridgeland and Vicksburg. Plants in Greenville and Vicksburg were 50+ years old needing replaced, where AWS is picking up a huge share of the cost while paying for their added electric power needs. Existing Entergy customers will benefit for decades from the new, more efficient plants, at a far lower cost than what would have been without the large industrial customers.Due to the data projects, Entergy recently announced a projected $5 billion in savings over 20 years to existing customers across their multi-state system with $2 billion of that to Mississippi customers. Further, Entergy Mississippi announced a $300 million upgrade to system reliability and storm strengthening efforts entirely due to new revenue from data centers.

Considering the path electric systems were on just a few years ago, large-load data centers are just the thing needed to take pressure off of rising electricity rates. Over the last few years, you may have noticed, electricity rates have risen, but why? Not data centers. Not higher natural gas prices. Inflation. The cost of just about everything rose much more sharply than normal from 2022-2025, and electricity followed.

Still, Mississippi comes in with electricity rates 16% lower than the national average. We want to keep it that way, right? The best way to do that is by growing the system, making the pie bigger and spreading costs across a growing consumer base. By the way, the same principle applies to taxes and public revenue, of which data center development can be a tax windfall, especially locally.

>>>READ: Blocking Data Centers Won’t Make Electricity Cheaper

The benefits of electricity-based development are just too great to turn away, and to turn away likely means to fall behind. Whether data centers or advanced manufacturing, forward thinking and more energy development could continue to pay off for years to come.

Patrick Sullivan is President of the Mississippi Energy Institute in Jackson.

The views and opinions expressed are those of the author’s and do not necessarily reflect the official policy or position of C3.