AI is driving consumer energy costs higher: The RGGI carbon price, which covers CO2 emissions from power plants across 10 northeastern US states, jumped +31% last week, to $47 per metric ton, the highest in at least 4 years. This increase briefly pushed RGGI prices past California's record CO2 price of $44 set in 2024. In other words, AI-driven power demand in the Northeast is repricing carbon risk faster than California's broader economy-wide market, with RGGI having historically traded at a fraction of California's price. This comes amid anticipation of Virginia's planned return to the market in July which will sharply increase demand for carbon permits, as this state contains a large amount of AI data centers. This is adding further pressure to consumer electricity bills, which are already rising due to the AI-driven boom in power demand. The AI buildout is redefining energy markets.(The Kobeissi Letter)