Jackson seeks separate Duke Energy rate class for data centers
North Carolina Attorney General Jeff Jackson is advocating for a separate electricity rate class for data centers and other exceptionally large users of power. The proposal, filed with the North Carolina Utilities Commission, aims to prevent residential customers from bearing the costs of new generation and transmission projects driven by the rapid data center buildout. Duke Energy, while acknowledging the demand, argues its existing framework helps allocate costs to large users.
North Carolina Attorney General Jeff Jackson has urged state regulators to establish a distinct electricity rate class for data centers and other substantial power consumers. His proposal, submitted to the North Carolina Utilities Commission as part of Duke Energy's pending rate cases, seeks to ensure that these large users bear the costs associated with the increased strain they place on the electric grid, rather than burdening residential and smaller business customers.
Jackson emphasized that the rapid proliferation of data centers is transforming the state's energy system, necessitating clear rules and greater transparency. He argued that a dedicated rate class would define consistent requirements for these facilities and reduce the likelihood of cost shifting. He also requested that Duke Energy disclose its template contracts for large power users and provide more frequent electricity demand forecasts.
Duke Energy, headquartered in Charlotte, has pushed back on the assertion that existing customers are exposed to undue costs. Company President and CEO Harry Sideris stated that Duke's Customer Protection Plus framework is designed to make data centers pay their fair share and generate long-term savings for existing customers. This framework includes provisions for customer-funded connection costs, upfront financial security, and termination charges.
The Utilities Commission will ultimately decide on the new rates, generation projects, and customer protections. The ongoing debate over data center energy demands is now a significant part of North Carolina's broader discussion about its energy future and how to equitably distribute the costs of grid expansion.