Schiff proposes legislation to force data centers to bring their own energy
Democratic Sen. Adam Schiff is introducing the Energy Cost Fairness and Reliability Act in the Senate to compel data centers to cover the costs of power grid upgrades. The legislation aims to prevent utility customers from bearing these expenses, citing the immense strain data centers, particularly those supporting AI, place on the electric grid and utility bills. The bill would also require a FERC policy update to enable companies to manage peak demand and utilize their own power sources.
California Democratic Sen. Adam Schiff has proposed new federal legislation, the Energy Cost Fairness and Reliability Act, aimed at addressing the increasing strain data centers place on the nation's electric grid and utility consumers. Schiff stated that the bill is the "strongest and most comprehensive data center energy consumption accountability legislation" introduced to date.
According to Schiff, the proliferation of large data centers, driven by the artificial intelligence boom, is leading to unsustainable demands on the power grid and driving up costs for taxpayers. He highlighted examples of massive data centers, like one Meta is reportedly building, to illustrate the scale of energy consumption. The proposed legislation would mandate that data centers themselves bear the financial responsibility for power grid upgrades necessary to support their operations.
Furthermore, the bill seeks to update Federal Energy Regulatory Commission (FERC) policy, allowing companies to reduce their demand during peak hours to mitigate blackouts or brownouts. It also encourages data centers to "bring their own power," which could involve power purchase agreements with existing plants or the construction of new generating facilities. Sen. Schiff acknowledged that passing such a bill would be challenging, but emphasized bipartisan recognition of the problem of rising utility costs for constituents.