New bill updates effort to shield Delawareans from high electric rates tied to data centers
Delaware lawmakers have introduced new legislation to regulate large electricity users, particularly data centers, aiming to protect residents and businesses from rising electric rates. This bill, which requires Public Service Commission approval for large energy agreements, follows public concern and the denial of Project Washington, a massive data center development in New Castle County.
Delaware lawmakers are advancing new legislation to comprehensively regulate large electricity users, particularly data centers, in an effort to shield residents and businesses from significant increases in electric rates. Introduced on May 21 and championed by State Senator Stephanie Hansen (D-Middletown) and State Representative Frank Burns (D-Newark), the substitute bill would mandate that energy users consuming at least 50 megawatts secure Public Service Commission (PSC) approval for an "Energy Service Agreement." This agreement would ensure that the new energy user, rather than ratepayers, bears the full cost of its energy demand, including expensive new transmission infrastructure.
The push for this legislation intensified following public concern over a planned 6 million square-foot "Project Washington" data center in New Castle County, which, if fully built, could consume about half of Delaware's total electricity. Although the project was denied by the state environmental agency DNREC and on appeal by the Coastal Zone Industrial Control Board, its developer, Starwood Digital Enterprises, plans to appeal to the state's Superior Court. Supporters of the bill, including Public Advocate Jameson Tweedie and Governor Matt Meyer, emphasize the need to set clear standards for data centers to prevent ratepayers from subsidizing their massive energy demands amid a national surge in data center development.
While some Republican lawmakers, such as Joseph Fulgham, expressed concerns that the bill's requirements—including the use of local workers and contributions to the Green Energy Fund—could deter investment, the bill is widely expected to pass both legislative houses before the session ends on June 30. Governor Meyer has indicated his support, stating he would sign the bill if approved by the General Assembly. The legislation also grants the PSC a crucial role in approving or denying large-user applications, a measure supported by environmental groups like the Delaware Sierra Club.