> If new generating capacity is required to meet the new, higher, demand, that should be factored in to the supply contract with the new large-consumer

My understanding is this wasn't done.

> What is the rationale for jacking up residential retail prices?

The most understandable explanations I've heard had to do with grid upgrades. Crap the utility owns and controls and has to change to accomodate the new power flows.

More often, however, it looks like local and state government engaging in industrial policy by trying to get residents to subsidise the new datacenters.

Upgrades also take time and may not be a good idea seeing how the current AI buildout is financed. There is a certain amount of capacity right now and AI behemoths have the financial muscle to take what's there. If that leaves too little for everyone else, prices will reflect that as soon as existing contracts allow.