North Carolina Legislature tests governor with data center bill

North Carolina lawmakers are considering the "Ratepayer Protection Act," a Republican-sponsored bill that aims to impose new restrictions on data centers while also addressing broader energy policy. The proposal has put Democratic Governor Josh Stein in a difficult position; while his administration supports regulating data centers to prevent families from shouldering energy costs, the bill contains two controversial provisions that critics argue could undermine the state's clean energy and climate goals. These include delaying the retirement of coal-fired power plants and launching a study into the feasibility and impact of North Carolina's 2050 carbon neutrality target.

The data center specific measures in the bill align with some of Governor Stein's previous recommendations. They would require local governments to assess data center impacts on noise, water, air quality, thermal plumes, agriculture, and forests. Critically, the bill mandates supercomputing campuses to use closed-loop cooling systems and bans evaporative cooling altogether to reduce water consumption. Furthermore, it prohibits foreign ownership of data centers, the use of eminent domain for their construction, and local incentives, while also ensuring customers are not burdened with the majority of data center energy and infrastructure costs.

However, the two other provisions are drawing significant concern. One provision would prevent the North Carolina Utilities Commission from authorizing the retirement of baseload electric generating facilities, such as coal plants, until a certificate for building a nuclear facility is issued. This language raises alarms for anti-coal advocates like Mikaela Curry of Sierra Club's Beyond Coal Campaign, who fear it could prolong the life of aging, polluting plants and increase costs for ratepayers, despite Duke Energy's plans to seek such certificates by 2028.

The second contentious provision would task the legislative services officer with commissioning a study on the costs of the state's 2050 carbon neutrality goal, rather than using the established North Carolina Collaboratory. Democratic state Representative Pricey Harrison, who serves on the energy panel, expressed concern that this approach could lead to a biased study intended to justify the repeal of the climate target. The bill, which passed the House Energy and Public Utilities Committee, has since been referred back to the Commerce and Economic Development Committee for further review.