Data centers, large loads, state authority and the power of federal regulators.
They are what prompted Wyoming U.S. Sen. Cynthia Lummis (R) to file a bill imposing federal controls on data centers and their access to the grid.
It’s a major issue for data center developers in Oklahoma as data centers seek the power needed to run their projects. It also sparked some of the state’s major utilities to seek authority for expanded power generation projects such as the requests made in recent months by Public Service Company of Oklahoma and Oklahoma Gas and Electric.
The bill is one of the first at the federal level to seek to set federal controls on how data centers connect to the grid. Several states have already imposed new rate classes for large load data centers to mitigate their impact on other ratepayers. Recent examples include Oklahoma and Florida, which both saw new ratepayer legislation signed into law over the last year.
Other states to see similar rules proposed and passed include Ohio, North Carolina, and Virginia, to name a few.
Sen. Lummis calls it the POWER Up Act and, if passed, would establish clear, uniform federal rules for how large loads on the grid connect to the interstate electrical transmission system.
“When a facility wants to draw as much power as a city, that is not an ordinary retail question. It is a grid question,” said Lummis. “Ratepayers need a clear process, informed by best practices, clear rules, and clear accountability. That is what this bill provides. America is going to need more power for data centers, advanced manufacturing, and the next generation of industry. The question is whether we handle that growth with clear rules and reliable planning, or with confusion and delay. Massive demand is here, and America needs a framework that supports investment in our communities while protecting the grid and the people who rely on it every day.”
The bill defines a “large load facility” as any facility or group of co-located facilities with a projected peak demand of 100MW or more and brings the interconnection of such loads to the transmission system under the Federal Energy Regulatory Commission’s (FERC) existing “just and reasonable” standard.
As Data Center Dynamics reported, the bill would require the Federal Energy Regulatory Commission to issue a final rule within 18 months establishing standardized procedures for large load interconnection, including provisions for hybrid facilities that combine on-site generation with grid-connected load at a single point of interconnection. FERC retains the ability to adjust the 100MW threshold by rule if grid reliability demands it.
State and local authority over siting, permitting, construction, retail rates, local distribution, and generation is explicitly preserved. The bill applies only to the transmission-level connection.
Read the bill text here.
Background:
- Defines the threshold. A “large load facility” is any facility or co-located group of facilities with projected peak demand of 100 MW or more. FERC can adjust this threshold by rule if grid reliability requires it.
- Clarifies FERC jurisdiction. Interconnection of a large load to the transmission system is subject to the same “just and reasonable” standard that governs transmission service for generation under FPA Sections 205 and 206.
- Mandates a rulemaking. FERC must issue a final rule within 18 months establishing standardized procedures for large load interconnection, including procedures for hybrid facilities that combine on-site generation with grid-connected load at a single point of interconnection.
- Preserves state authority. Explicit carve-outs protect state and local jurisdiction over siting, permitting, construction, retail rates, local distribution, and generation. The bill touches only the transmission-level connection, and this makes that clear.
