A bill aimed at shielding consumers from data center-driven increases in electricity costs passed the House this week, marking the first significant congressional effort to grapple with one of the primary concerns surrounding rampant data center development.
But the legislation quickly stalled in the Senate, where critics argued it would do little to lower energy bills.
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The House of Representatives approved the Ratepayer Protection Act on Wednesday by a 417-3 margin. The legislation aims to prevent households and small businesses from bearing the cost of the electrical grid upgrades and power plants needed to serve data centers.
While the bill may eventually clear the Senate, an attempt by Sen. Jon Husted, an Ohio Republican, to fast-track the legislation was blocked by Democrats on Thursday, meaning there is little chance of its passage ahead of November’s midterm elections. That could be bad news for some Republicans — particularly Husted — whose support for data center development has become a liability with voters.
Senate Democrats framed the bill and Republicans’ urgency to pass it as more politics than substance. Minority Whip Dick Durbin, of Illinois, called it “last-minute legislation on a subject that’s controversial in the senatorial contest,” according to Politico.
Republicans, however, blasted Democrats for blocking legislation that has bipartisan support and addresses one of the public’s biggest concerns about the artificial intelligence infrastructure boom.
“It is a shame that this opportunity has been missed today, but I will be back to push this issue forward,” Husted said.
The potential for rapid data center development to drive up electricity bills has become one of the primary flashpoints for a nationwide wave of opposition to the industry. Customers served by PJM Interconnection, the nation’s largest power grid, have already seen their bills rise largely due to surging demand from data centers.
The Ratepayer Protection Act would require states to “consider” adopting a framework to ensure that data centers with at least 100 megawatts of capacity bear the full cost of the electricity needed to serve them.
It isn’t just Democrats suggesting the legislation lacks force.
The bill doesn’t mandate any concrete action, and ClearView Energy Partners wrote in a client note Thursday that it is “somewhat behind the regulatory curve,” as the steps it asks states to consider are already being undertaken across most of the U.S., according to Utility Dive. A majority of states — including data center hotbeds like Virginia, Texas and Ohio — are already pursuing or have enacted measures meant to ensure data centers pay their own freight.
The federal legislation, therefore, does little more than “reinforce” a trend that was already underway, according to ClearView.
While the Ratepayer Protection Act initially emerged as a rare bipartisan effort to address rising energy costs, Republicans have increasingly embraced the legislation amid Democratic efforts to portray the GOP as the party most closely aligned with the rapid expansion of the data center industry.
Inflammatory rhetoric about data center opposition from President Donald Trump has also fueled the perception that the GOP is the party of data centers. In recent weeks, Trump has dismissed opposition to data centers in particularly blunt terms, saying communities that block data centers “want to end up being backwards and poor” while calling criticisms of the data center boom a “hoax” and a “sick conspiracy.”
Republican leaders are ringing alarms that the party’s association with data centers will have dire consequences in November. And no Republican has been more squarely at the center of the data center storm than Ohio’s Husted.
Last month, the National Republican Senatorial Committee sent a memo to major tech and AI firms warning that increasingly negative public sentiment toward data centers is hurting Husted’s reelection efforts. The NRSC said Democrats were making data centers a “centerpiece” of their campaign against Husted, with Democratic candidate Sherrod Brown spending millions of dollars on advertisements labeling his opponent “the face of data centers in Ohio.” They said the strategy is proving effective.
Husted had hoped to have the Ratepayer Protection Act on Trump’s desk ahead of the midterms by having it passed by unanimous consent Thursday, a process through which opposition from a single senator can block its passage.
The bill ended up being derailed by a lone senator, New Mexico’s Martin Heinrich, the top Democrat on the Senate Energy and Natural Resources Committee. He attempted to get his own bill, called the Guarding Ratepayers from Increased Demand-costs Savings Act, or GRID Act, passed by unanimous consent Thursday. But that was blocked by Republican lawmakers.
Heinrich said the Republican-backed measure didn’t go far enough, as it merely urged states to adopt consumer protections instead of requiring them.
“Rather than voluntary pledges, or suggestions to states, Congress needs to pass real legislation with real teeth,” Heinrich said, according to Politico.
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