Democratic sweeps in Virginia and New Jersey and the dramatic fallout from smothering everyday costs for many Americans has set the stage for political battles in 2026, as electricity prices rise ahead of next year’s slate of gubernatorial and midterm congressional races.
Democrats who campaigned on restraining electricity price increases won big Tuesday, including Abigail Spanberger in Virginia and Mikie Sherrill in New Jersey in their races for governor. That suggests that concern over energy “affordability” will continue to resonate with voters through next year, with incumbent governors and challengers of both parties battling over the role that fossil fuels, wind and solar power, and booming data center projects are playing in rising household costs.
After Tuesday’s off-year wins for Democrats, President Donald Trump sought to reclaim the populist mantle.
“AFFORDABLITY is a Republican Stronghold,” Trump wrote Wednesday night on Truth Social, after touting his “drill, baby drill” energy policy during a speech in Miami.
Trump’s former chief strategist Steve Bannon, in an interview with POLITICO, pushed Republicans to embrace a more aggressive domestic policy agenda that emphasizes job creation.
“It’s twofold, not just affordability across things, but also jobs,” Bannon said.
Trump’s comments come as many food and housing prices are up. The government shutdown now in its second month is, in part, a fight over the extension of key health insurance subsidies.
On energy, monthly utility bills made it into stump speeches. To explain higher prices, Democratic candidates criticized Trump administration efforts to kill clean energy projects and shift to more expensive natural gas and coal. In both Virginia and Georgia, the booming business of building AI data centers and passing the costs of electricity upgrades onto ratepayers left other openings for Democratic candidates.
The New Jersey and Virginia elections underscore the potency of energy prices in state politics, including the 36 governors races coming up in 2026, said Barry Rabe, a professor emeritus of environmental policy at the University of Michigan.
“All these states have different energy mixes and pricing levels but incumbents will be challenged to defend their records,” Rabe said. “At the same time, the impact of Trump administration policies on states will also likely loom increasingly large, given the President’s pledge to drive down energy costs and reject solar and wind in favor of expanded coal, gas, and nuclear output.”
In her acceptance speech Tuesday night, Spanberger tied energy costs to supply. “We are going to lower costs,” she said, “and we’re going to do it by producing more energy in Virginia.”
Electricity prices went up 5.1 percent nationwide over the past year, according to government data. The natural gas consumer price index went up 11.7 percent over 12 months ending in September, four times the economywide inflation rate.
Nearly 6 of 10 Americans blame Trump, a Washington Post-ABC News-Ipsos poll reported this week. But the causes of higher electricity prices is regional, ultimately. The mix of energy resources that feed into electricity prices in California is different than in Illinois, which is different than Pennsylvania or Georgia. Political analysts that POLITICO’s E&E News spoke with Wednesday said Democrats could struggle to find a cohesive national message on energy — particularly as diverging interests within the Democratic coalition try to shape that argument.
In Virginia, Spanberger has called for more support for offshore wind and energy storage, among other things. Sherrill said Tuesday night “I’m going to declare a state of emergency on Day 1 to drive down your utility costs,” a nod to her plan to freeze utility rates and support cleaner power.
Republicans are also pointing to power costs in the post-election debate. In comments on X, Ohio gubernatorial candidate Vivek Ramaswamy said “we got our asses handed to us” Tuesday night, before citing electricity costs first in a list of priorities Republicans should focus on in 2026 as part of an affordability platform.
The outcome of this year’s state races could influence whether Democrats nationally veer more to the left on energy policy, or instead follow a more centrist path, ClearView Energy Partners said in preelection research note.
But Rabe said he didn’t think that Zohran Mamdani, a democratic socialist who won New York City’s mayoral race, would be a major factor in 2026 gubernatorial races on energy policy, despite any attempts by Trump and Republicans to tie him to the issue.
“In Iowa, for example, electricity costs are quite low, and they have a huge wind base that seems to have broad support,” Rabe of the University of Michigan said. “I would expect an issue there to be the impact of data centers and the restart of the Duane nuclear plant on their monthly bills rather than anything emanating from New York City Hall.”
‘Wide open door?’
For now, energy insiders are closely watching how Spanberger and Sherrill — and Democrats newly elected to sit on the public utility commission in the battleground state of Georgia — implement their plans, although it remains unclear how some mechanisms to reduce prices will work.
In Virginia, the state most affected by the AI boom’s hunger for data center power, Spanberger has called for data centers to “pay their fair share” and increase state energy generation to bring down bills. She defeated the Republican lieutenant governor, Winsome Earle-Sears, in the gubernatorial race.
The political salience of data centers has been growing in the commonwealth, where lawmakers introduced a flurry of bills this year to regulate AI energy demands and candidates in northern Virginia crafted campaigns around their land use and infrastructure costs.
One of those candidates, Democrat John McAuliff, centered his campaign for the House of Delegates in District 30 on data centers and beat Republican incumbent Del. Geary Higgins by 636 votes, according to unofficial results.
In Georgia, two Democrats defeated incumbent Republicans to earn seats on the Public Service Commission, which regulates utilities. The two candidates, Peter Hubbard and Alicia Johnson, notched the first statewide wins for Georgia state Democrats in almost 20 years.
Frances Sawyer, who runs Pleiades Strategies, a strategy consulting firm, said Democrats’ wins show there’s a “wide open door” for campaigns in future races focused on finding solutions to high household costs. Those proposed solutions could differ depending on the candidate and state.
Jane Kleeb, president of the Association of State Democratic Committees and vice chair of the Democratic National Committee, said candidates in 2026 races will likely be focusing on bringing costs down and diversifying energy sources as “two pillars” of an energy policy. Some candidates will link those pillars to climate change concerns, while others may not.
“That’s where you’ll see the diversity” of the party and its coalitions, Kleeb said.
However, some factors affecting electricity prices and the trajectory of the energy sector are outside of the control of the incoming governors, including Trump administration cuts to energy projects in swing states.
Josh Basseches, a professor of political science at Tulane University, noted that legislators in Virginia have influence over who is appointed to public utility commissions, for example. “Of course, Democrats made significant gains [Tuesday] in the Legislature, too, and a Democratic governor has a significant informal influence over co-partisan legislators” through the bully pulpit, he said.
“In practice, there are other factors over which governors have less control, such as the rules governing interstate wholesale electricity markets,” Basseches noted. “Of the new Democratic governors’ many promises, this will be one of the more difficult, but not impossible, ones for them to deliver on.”
The PJM factor
Although Virginia and New Jersey both hosted Democratic victories, their roles in the national energy debate are different. As one example, New Jersey has stuck to its climate policy goals. Virginia, under the current Republican governor, Glenn Youngkin, swung back to prioritize fossil fuels.
One factor the states share is being part of the regional power-sharing grid PJM Interconnection, which has faced intense debates over current and futures electricity prices. As the center of U.S. data center operations, the region is ground zero in the intensifying debate over who should pay for infrastructure needed to serve AI data centers.
“The speed at which these new loads are coming on is so intense, and the political interest in economic development and AI expansion is so intense that that the system simply can’t expand fast enough to meet the new load,” said Johns Hopkins University research scholar Abe Silverman, speaking at an industry forum Wednesday.
Sherrill joined other Democrats and clean energy advocates in criticizing PJM, saying it favors fossil fuel interests.
In comments after Tuesday’s election, Evan Vaughan, executive director of the Mid-Atlantic Renewable Energy Coalition, said: “Exit polling appears to show that affordability was a key topic this election cycle, and the best way to stabilize electricity prices in PJM states is to add fixed-price solar, wind and storage resources as quickly as possible.”
At least four governors in the PJM region are considered potential contenders for the 2028 Democratic presidential nominations: Pennsylvania Gov. Josh Shapiro, Illinois Gov. JB Pritzker, Maryland Gov. Wes Moore and Kentucky Gov. Andy Beshear, with Shapiro and Moore facing reelection next year.
Shapiro has led a bipartisan coalition of his region’s governors, including Moore and Pritzker, in demanding that PJM’s managers do more to restrain the projected eruption in data center construction and demands for power that are growing faster than new power plants can be added, according to PJM.
Wholesale electricity prices in PJM rose 41 percent from the first six months of 2024 to the first six months of 2025, according to Monitoring Analytics, the system’s independent market auditor. The increase was “almost entirely the result of large data center load additions, both actual historical and forecast,” it added.
The governors’ dilemma is that most of their utilities and many of their communities are happy to have data centers, their energy leaders say. As Rudy Garza, CEO of CPS Energy in San Antonio, said at a recent discussion about data center growth, “We’re very excited about the tax revenue that generates for the communities that we serve.” But his utility faces a “delicate dance” to see that its customers don’t get stuck with the tab, he added.
Shapiro is striving to make Pennsylvania a national center of AI technology development, citing the potential economywide benefits including to his state’s energy producers. Sherrill’s support is more qualified. She wants her state to benefit from AI technology and clean energy.
But data centers are coming, all sides agree, and with them, an increasing debate about how to make sure they “don’t drive up energy costs for everyone else in Virginia,” as Spanberger said in a campaign statement.
