AEP Ohio Secures $4.2B Deal for AI Data Center Grid

AEP to Build $4.2B Grid for 10-Gigawatt AI Campus

American Electric Power's Ohio unit is set to build $4.2 billion in new electrical infrastructure to support the region's burgeoning data center industry. The plan, announced on March 20, 2026, involves constructing new 765-kilovolt (kV) transmission lines in Piketon, Ohio. This high-capacity grid is specifically designed to power a massive 10-gigawatt data center campus planned for the site of a former gaseous diffusion plant.

The project is a partnership between AEP Ohio, the U.S. Department of Energy, and SB Energy, a subsidiary of SoftBank. Under the agreement, SB Energy will finance the entire $4.2 billion cost of the new transmission infrastructure. This structure is intended to prevent the capital costs from being passed on to AEP Ohio's 1.5 million residential customers. AEP, a pioneer in 765-kV technology, anticipates that power will begin flowing to the site in 2029.

Investment Underscores AI's Surging Power Demand

The project directly reflects the immense and growing energy requirements of the artificial intelligence sector. A 10-gigawatt campus represents a significant power draw, and AEP's investment positions it to capture long-term revenue from this high-growth demand. The deal provides a critical solution for powering one of the world's largest planned AI data centers.

Ohio is experiencing some of the fastest electricity demand growth in the nation, driven by data centers.

— Marc Reitter, AEP Ohio President

By securing a dedicated partner to fund the grid expansion, AEP Ohio has created a framework to serve this industrial growth while publicly committing to protecting its existing ratepayer base from the direct infrastructure costs.

Ratepayer Costs Remain a Point of Contention

While SB Energy's financing shields residents from the cost of the transmission lines, the project surfaces a wider debate in Ohio over the economic impact of data centers. A report from the nonprofit Innovation Ohio, released March 11, warned that the cumulative effect of data center growth could increase the average Ohio family's electricity bill by $70 per month by 2028 due to higher overall demand on the power grid.

This tension is compounded by criticism of state subsidies. Another think tank, Policy Matters Ohio, calculated that tax breaks for data centers cost the state nearly $1 million per job created. The issue is politically charged, highlighted by the Ohio legislature's failed attempt to ban a sales tax exemption on new data center equipment in 2025, a measure Governor Mike DeWine vetoed. This underlying controversy presents a potential regulatory and political risk for future energy projects in the state.