Microsoft, ratepayer advocates challenge ATC plan for data center transmission costs

Microsoft and Wisconsin ratepayer advocates are urging the Federal Energy Regulatory Commission (FERC) to halt a proposal from We Energies and the American Transmission Company (ATC) concerning the allocation of transmission infrastructure costs for data centers. Both parties contend that the utilities' plan, which mirrors a strategy previously approved by Wisconsin's Public Service Commission (PSC), does not sufficiently safeguard Wisconsin residents from incurring the construction costs associated with new data center infrastructure.

The utilities' proposal seeks to establish a minimum transmission charge for Microsoft, based on the anticipated electricity needs of its Mount Pleasant data center. We Energies and ATC argue this minimum charge would prevent other customers from subsidizing overbuilt infrastructure if the data center consumes less electricity than projected.

However, Microsoft and the ratepayer advocates assert that the proposal fails to protect Wisconsinites from potential cost shifts and criticizes the utilities for offering limited opportunities for stakeholder input. ATC estimates that connecting the Mount Pleasant facility to the electrical grid will require more than $500 million in upgrades, costs typically passed on to all utility customers through their electrical bills. While the PSC previously approved a workaround requiring a minimum transmission charge for large data center customers, only FERC has the authority to revise billing rules to fully shield other customers from these new infrastructure costs.