North Dakota Public Service Commission Clarifies Regulatory Authority Over Data Centers

North Dakota Public Service Commissioner Sheri Haugen-Hoffart recently addressed public confusion regarding the commission's authority over the state's rapidly growing data center industry. Haugen-Hoffart explained that while data centers are proliferating across North Dakota's rural and urban areas, consuming vast amounts of electricity, the PSC has very limited direct regulatory oversight of these facilities as standalone entities. The PSC's jurisdiction is almost entirely tied to the utilities and power systems that serve data centers. This includes reviewing and approving large energy infrastructure projects, regulating investor-owned utilities like Montana Dakota Utilities, Otter Tail Power, and Xcel Energy, and ensuring that new substations or transmission lines built for data centers are paid for by the customer rather than general ratepayers. However, the PSC cannot regulate data center siting, construction, operations, or water usage. Haugen-Hoffart noted that North Dakota's current regulatory framework predates the data center boom. A proposed House Bill No. 1579, which would have granted the PSC direct authority over data center siting, was withdrawn in the 2025 legislative session. A legislative management study is now underway to examine the impact of large energy consumers, including data centers, on the state's electrical grid, regulatory structure, and economic development.