Governor Jeff Landry signs executive order to protect ratepayers from absorbing AI data center electricity costs
Governor Jeff Landry of Louisiana signed an executive order requiring AI data centers to cover their own electricity costs, preventing these expenses from being passed to ratepayers. This initiative follows concerns about Entergy's plan to acquire a Texas power plant, which could raise residential rates to support a Meta data center in Richland Parish. Data center companies must now demonstrate their ability to meet energy demands without burdening customers to qualify for state tax breaks.
Governor Jeff Landry signed the "Louisiana Ratepayer and Community Protection Initiative" executive order, aiming to prevent residents and local businesses from bearing the massive electricity costs associated with artificial intelligence data centers. The order mandates that data center companies seeking state tax breaks must demonstrate their capacity to cover their own energy demands, explicitly prohibiting them from passing these expenses to ratepayers.
This action follows a report from The Advocate detailing Entergy's intention to acquire a power plant in Texas, a move projected to cost average Entergy residential customers an additional $8 per month, primarily to support a Meta data center currently under construction in Richland Parish. Governor Landry emphasized that while Louisiana welcomes data center development, it will not allow such projects to burden the state's ratepayers with increased utility costs, referencing similar issues on the East Coast.
Entergy, however, stated its plan to purchase the Texas power plant predated Meta becoming a potential customer and reaffirmed its commitment to delivering substantial customer savings over the next two decades. The Louisiana Department of Economic Development is tasked with reviewing evidence from data center companies to ensure compliance with the new guidelines before granting tax incentives.