Delaware lawmakers aim to make data centers pay higher rates
Delaware lawmakers have introduced legislation to mandate higher electricity rates for data centers consuming over 50 megawatts monthly. The bill aims to protect residential ratepayers from bearing the costs of infrastructure expansion driven by data center demand, giving the Public Service Commission oversight. This comes amid concerns about rising electricity bills and the strain on the power grid caused by increasing data center activity.
Delaware lawmakers have introduced new legislation designed to make data centers financially responsible for their impact on the state's electricity grid. The proposed bill mandates that Delmarva Power, a subsidiary of Exelon, establish a separate, higher electricity rate for customers using more than 50 megawatts per month. The primary goal is to prevent the technology industry from shifting the costs of necessary grid infrastructure expansion onto residential customers, following a public outcry over increasing utility bills.
State Sen. Stephanie Hansen, D-Middletown, a co-sponsor of the bill, noted a tempering of the previous push for rapid data center development due to citizens experiencing wildly increasing electric bills. The legislation would grant the Delaware Public Service Commission (PSC) the authority to oversee connections to the electric grid and review agreements between large energy-use facilities and utilities, ensuring fair cost allocation among customer classes. The PSC would also consider environmental impacts and protect ratepayers from potential losses from stranded assets.
PJM Interconnection, which manages the regional electrical grid, has previously cited the rise in data centers as a contributor to increased demand and higher electricity bills. Under the proposed bill, individual data centers would be required to cover the costs associated with building new transmission and distribution infrastructure, as well as capacity procurement, wherever feasible. If not possible, these costs would be distributed among the entire class of large energy-use customers. Delmarva Power has indicated it will review the introduced legislation.