Sponsor
Jon Husted
Senator · R-OH
Senator · R-OH
The bill shifts the financial burden for costly grid upgrades onto very large data‑center customers and gives states a quick timetable to set rules—protecting existing ratepayers and utilities but raising costs and regulatory burdens for large customers and for states to implement.
Utilities and existing electricity customers (ratepayers and taxpayers) are protected from shouldering the full cost of costly grid upgrades for very large data‑center customers because those customers must pay incremental upgrade costs or provide financial assurances.
State regulators gain a clear federal timetable (1–2 years) to consider and decide on large‑load customer rate standards, reducing prolonged uncertainty and speeding regulatory resolution for utilities and customers.
Very large commercial data‑center operators (≥100 MW) face higher upfront costs or barriers to grid connection because they must provide financial assurances and be charged the full incremental cost of upgrades, which could deter investment or raise operating costs.
If a large customer later terminates service, remaining customers or utilities could face stranded cost disputes or higher rates if recovery terms are contested or insufficiently enforced, shifting financial risk back to ratepayers or taxpayers.
States that have not previously considered such standards will face administrative and compliance burdens to conduct proceedings and implement new rate designs within the required 1–2 year window, imposing staff time and regulatory costs.
Based on analysis of 2 sections of legislative text.
Adds a PURPA ratemaking rule requiring full incremental upgrade cost recovery and financial assurances from very large (≥100 MW) IT‑intensive customers; directs state consideration within 1 year and decision within 2 years.
Official title: Amend the Public Utility Regulatory Policies Act of 1978 to establish a Federal standard relating to the recovery of the full, incremental costs of upgrades that serve large-load customers, and for other purposes.
Introduced July 16, 2026 by Jon Husted · Last progress July 16, 2026
Creates a new federal ratemaking rule under PURPA requiring utilities to design rates for very large, IT‑intensive nonresidential customers (data centers and similar) so utilities can recover the full incremental costs of any generation, transmission, or distribution upgrades needed to serve those customers. Utilities must seek financial assurances or contributions from such customers before making upgrades. Directs state regulatory authorities and nonregulated utilities to begin considering the new standard within one year of enactment and to complete determinations within two years, with some exceptions for states that have already considered or enacted comparable standards.