Senate setback stalls bill to curb AI data center utility costs

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AI data center bill stalls

Highlights

Sen. Martin Heinrich blocks the Ratepayer Protection Act in the Senate, stalling the bill before the upcoming election despite House passage by a 417-3 vote.
The legislation sought to let states shift utility upgrade costs for AI data centers over 100 megawatts to developers rather than local ratepayers, but lacked binding requirements.
Husted warns the U.S. could see 1,000 new major data centers in five years with over 2,000 projects proposed, intensifying scrutiny over utility infrastructure costs.

Senate push falters before election

As first reported by CNBC, the Ratepayer Protection Act stalls in the Senate after Sen. Martin Heinrich, the top Democrat on the Senate Committee on Energy and Natural Resources, objects to a request for unanimous consent from the bill's sponsor, Sen. John Husted of Ohio.

Heinrich says the legislation does not go far enough because it relies on voluntary commitments from states and data center developers rather than binding requirements. Speaking on the Senate floor on Thursday, he says Congress should pass stronger legislation that directly prevents residents from absorbing the costs tied to new grid and infrastructure upgrades.

The procedural block makes it all but certain the measure does not advance before the election, with the Senate set to leave Washington in two weeks. The House passes the bill on Wednesday by a 417-3 vote, with opposition coming only from three progressive Democrats, Reps. Summer Lee, Delia Ramirez and Rashida Tlaib.

Utility cost debate gains national weight

The bill would create a regulatory framework that states could choose to adopt for AI data centers with power demand of 100 megawatts or more. Under that framework, developers would be expected to cover the costs of new power generation, transmission lines and other related infrastructure instead of passing them on to ratepayers.

Lawmakers are taking up the issue as resistance to data center expansion grows across the country and as the facilities become more closely tied to the AI boom. Husted, who introduced the bill in July and faces a difficult reelection race, says he will keep working for passage, arguing that the U.S. may build the equivalent of 1,000 major data centers over the next five years while more than 2,000 projects are being proposed or tracked.

Our earlier coverage of the Ratepayer Protection Act explained how lawmakers are trying to keep the fast-growing AI data center buildout from shifting new power generation, transmission, and other grid upgrade costs onto households. We outlined how the proposal would push state utility regulators to consider requiring large-load data centers to pay the incremental expenses tied to their demand, amid rising public and political resistance to new facilities.

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