Proposed NC bill targets data center costs, power demand

North Carolina lawmakers have introduced the 'Ratepayer and Resource Protection Act,' a bill designed to address the increasing strain data centers place on the state's electricity grid and water resources. Introduced by Rep. Lindsey Prather, a Democrat from Buncombe County, the proposed legislation would mandate that large-scale data centers pay cost-based electric rates, cover associated infrastructure growth expenses, and generate at least 25% of their electricity on-site using clean energy. These requirements would apply to facilities with peak electricity demand of 40 megawatts or annual water use exceeding 1 billion liters. The bill aims to prevent "cost shifting," where the expenses of serving massive industrial users are spread across residential and small business customers. Utilities, including Duke Energy, have expressed concerns about the rapid growth of data centers, driven by AI and cloud computing, which is accelerating the need for new power plants and grid upgrades. Experts like Harrison Fell from North Carolina State University compare the current demand growth to levels not seen since the 1950s and 60s, noting that adding a data center is akin to adding a small city. While state and local leaders have historically promoted data centers for economic development, the environmental and infrastructure costs are prompting reevaluation. The proposal is currently in its early stages, and its passage through the Republican-controlled legislature remains uncertain. Critics warn that stricter requirements could potentially deter data center development in North Carolina, potentially shifting projects to states with less stringent environmental regulations.