Power Bills Are Becoming the New Rent Increase. Here’s How Owners Can Fight Back.
Texas has a warning label right now.
A new analysis highlighted by the Houston Chronicle projects that electricity bills in Texas will keep climbing through 2030 as utilities pour money into poles, wires and grid upgrades to serve fast-growing demand, including data centers and electrification industry. The headline number is attention-grabbing: residential electricity prices up about 30% since 2021, with modeling pointing to roughly another 29% increase by 2030.
For commercial real estate, the point is not whether the exact percent is right. The point is that rate pressure is moving from “background inflation” to a line-item risk that can shape Net Operating Income, underwriting and tenant satisfaction. And Texas is not alone.
Why this matters to buildings, not just households
Most commercial properties don’t pay electricity the way homeowners do. You might have a negotiated supply contract, time-of-use pricing, and the part that can hurt the most: demand charges — fees tied to your single highest bursts of power use. If you electrify and your peak spikes (EV charging + HVAC + hot afternoon), you can add cost even if total kWh stays flat.
That’s why rising electric bills is not just a consumer story. It’s an operating-cost story, a design story, and increasingly a planning story as cities and states weigh how to allocate the cost of grid upgrades that serve high-growth loads.
Texas: rising bills and a clear NOI lesson
The Houston Chronicle report ties bill pressure to a combination of grid hardening, inflation, and heavy utility investment to meet rising demand — with CenterPoint Energy alone planning nearly $20 billion in spending through 2030, according to the article’s reporting.
For owners, the takeaway isn’t “don’t electrify.” It’s this:
If your tariff penalizes peaks, your most valuable “electrification tech” might be controls and storage. Managed EV charging, smarter building management systems, and even modest battery storage can be used to shave peaks and reduce demand exposure — essentially converting a volatile bill into something closer to a controllable operating input.
That’s why the most useful question in Texas isn’t “how many chargers do we need?” It’s “what does our peak look like after we install them?”
Washington, D.C.: grid modernization, data centers and the politics of affordability
Utility bill pressure isn’t confined to deregulated markets or the Sun Belt. In the Washington region, Axios reported that bills are rising again this winter as utilities raise rates and modernize infrastructure, with additional pressure from regional demand growth, including data centers. The story notes that some residents saw bills exceed $800 during last winter’s cold snaps, underscoring how fast affordability can become political.
The CRE angle: when a region becomes a big-load magnet, utility planning becomes local news and local politics. That can influence:
How quickly utilities are allowed to raise rates;
What kinds of building electrification programs regulators prioritize;
Whether big customers are expected to shoulder more of the costs.
D.C. is a reminder that the narrative around electric bills can quickly become a question of who pays for growth, shaping policy decisions that affect commercial tariffs.
PJM: auction prices suggest higher costs ahead for a huge slice of the U.S.
If Texas is the noisiest warning, PJM is the biggest. PJM runs the capacity market that helps ensure enough generation is available for peak demand across 13 states and Washington, D.C.
Reuters reported in December that PJM’s latest capacity auction hit record-high prices, signaling that higher utility bills may be ahead as demand rises (including from data centers) and supply fails to keep pace. This is not a small regional story — PJM covers a significant share of the U.S. population, so these price signals matter to owners across much of the Mid-Atlantic and Midwest.
For CRE owners, the most practical point is this: the cost stack behind your electric bill is changing. Even if your building is efficient, you can still be swept up in system-wide costs tied to reliability procurement, infrastructure and capacity planning. This is where behind-the-meter strategies start looking less like “nice-to-have sustainability” and more like insurance against market-level volatility.
Virginia and the data center question: new rate classes and cost allocation
Virginia has become ground zero for the “AI load boom meets local ratepayer politics” storyline. A recent explainer notes that Virginia regulators approved a new electricity rate class for large-load customers (including AI data centers), requiring them to pay for a minimum share of contracted demand starting in 2027.
This is the kind of policy lever owners should track even if they never host a data center. Why? Because it’s a blueprint: when very large loads arrive, regulators and utilities start asking how to prevent “stranded costs”, i.e., upgrades built for one customer that end up socialized if that customer scales back.
The likely next step in more states is not just higher rates, but more tailored tariff design — minimum bills, special contract terms, and sharper pricing that pushes customers to manage peaks.
That is exactly where commercial properties can win: the more flexible you are, the more you can adapt.
California: rate relief can be temporary — but the grid cost debate isn’t going away
California is complicated. PG&E customers are seeing a rare bill decrease in early 2026, according to the San Francisco Chronicle, after years of rate increases driven by multiple factors including wildfire-related costs.
Still, California’s long-term story is still “high costs + high scrutiny,” and owners there already live in a world where demand charges, time-of-use and electrification requirements can make bill management a core operating discipline. A key point for national readers: even in markets where bills dip for a quarter or a year, the structural drivers, such as reliability upgrades, climate resilience, new loads, remain.
Translation: Don’t confuse short-term bill relief with a long-term “rates are solved” narrative.
Real case studies owners can learn from
Owners don’t need theory. They need proof that these tools work. Here's how some states are tackling the problem:
New York: Batteries as “non-wires alternatives.” Con Edison has pointed to battery systems as a way to improve reliability and meet rising demand without always building expensive traditional infrastructure upgrades. In one example, the utility pointed to its installation of a large battery system on substation property to support reliability for hundreds of thousands of customers in parts of Brooklyn and Queens, describing it as a way to meet power needs while avoiding more expensive buildouts. That matters to CRE because it signals a shift: utilities are increasingly willing to treat storage — sometimes at the substation, sometimes behind the meter — as part of the planning toolkit.
California: Commercial solar + storage economics. A Stanford-affiliated case study compendium includes examples of California commercial buildings where solar-plus-storage is analyzed over long horizons, framing storage as a meaningful contributor to peak reduction and long-run cost savings under commercial tariffs.
The point isn’t that every building should buy a battery tomorrow. It’s that the “battery + controls” play is moving from boutique to financeable — and it’s often the difference between electrification that feels expensive and electrification that pencils out.
What it means for large-scale housing developments
Master-planned communities and multifamily properites have a unique problem: They’re electrifying loads and building a customer experience. If bills rise and peaks get penalized, residents will still expect EV charging to “just work.” The answer for many developments will look like a portfolio strategy:
Install plenty of Level 2, but manage it.
Use load controls so EV charging doesn’t collide with HVAC peaks.
Make room for storage — even if it’s phase two.
Treat resiliency as a feature that can reduce insurance and vacancy risk
For those who get this right, energy management becomes part of the amenity stack like package rooms and Wi-Fi while protecting NOI.
The practical playbook: NOI defense, not energy geekery
Electricity costs are rising in different ways in different places — wires investment in Texas, winter spikes and modernization in the Mid-Atlantic, capacity price signals in PJM, long-run resilience costs in California.
Owners don’t need to predict every tariff change. They do need to reduce the parts of the bill they can control:
Measure your peak (interval data). You can’t manage what you can’t see.
Prioritize controls before capacity. Managed charging and BMS upgrades often beat “more electrical service” on cost and speed.
Use storage strategically. Batteries are most valuable when they cut peaks, provide resilience, and (where available) earn revenue from programs — not when they sit idle.
Plan for policy. Regions with large-load growth are experimenting with rate design and cost allocation. That will affect development pro formas.
