Riley introduces bill to shield ratepayers from data center grid costs
Congressman Josh Riley introduced bipartisan federal legislation, the FAIR Data Act, to compel large data centers to pay for electric grid upgrades stemming from their demand, preventing these costs from being passed to ratepayers. The bill targets data centers using at least 75 megawatts and tasks state utility regulators with establishing consumer protections. This legislation is motivated by concerns over rising electricity rates and specific data center proposals in New York.
Congressman Josh Riley (D-NY) introduced the bipartisan FAIR Data Act, legislation aimed at requiring large data centers consuming at least 75 megawatts to cover the costs of electric grid upgrades necessary for their operations. The bill seeks to prevent utilities from passing these expenses to residential and small business ratepayers, a practice Riley argues has led to substantial electricity rate increases nationwide. The proposed legislation would empower state utility regulators to implement consumer protections and ensure investor-owned utilities recover costs directly from major data center facilities.
The FAIR Data Act, which utilizes the Public Utility Regulatory Policies Act framework, also mandates annual reports from data centers promising lower local electricity bills, tracking whether these savings materialize. Furthermore, it would condition Department of Energy administrative assistance on states certifying that data center costs are not being shifted to smaller customers and require the Federal Energy Regulatory Commission to report annually to Congress on the impact of large data center demand on rates and grid reliability.
Riley cited two data center projects within his New York's 19th Congressional District as examples underscoring the need for the bill. Maryland-based TeraWulf is planning a 300-400 megawatt AI data center at the former Cayuga Power Plant in Lansing, while Eco-Yotta is pursuing rezoning for an AI data center in Oneonta. Both proposals have reportedly faced local opposition, contributing to concerns about cost burdens on Upstate New Yorkers.