OH Regulators Rule Data Centers Must Pay More Upfront Costs (And We'll See How Long This Stance Lasts . . . )

[hatrack]

Energy regulators in Ohio said on Wednesday that electricity-hungry data centers must pay more up front for their power demands, overruling the objections of the tech companies that rely on them to develop artificial intelligence. The decision could set a precedent in other places grappling with soaring data center power demands, as summer temperatures climb and AI’s appetite for energy has raised concerns about rising home electricity bills.

Surging power demand from data centers is on track to force utilities to make expensive grid upgrades in Ohio and other states. Major tech companies including Meta, Google, Microsoft and Amazon have data centers in Ohio. The tech giants supported a competing proposal that would have been more lenient on them but risked passing the increased costs on to consumers.

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The Ohio showdown over data centers’ impact on energy infrastructure started last year, when power company American Electric Power proposed increasing a monthly charge on data centers in the state from 60 percent of their projected consumption to 90 percent — regardless of their actual usage. The power company said the increased charge was needed to help cover the cost of expensive transmission-line upgrades required to serve data center energy needs. AEP said demand from dozens of pending data center customers was set to more than triple its previous peak load.

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The Data Center Coalition said in a filing that the proposal unfairly targeted data centers and risked “unduly stifling data center development” in Ohio. “We continue to maintain that no one customer type or industry should be singled out for disparate rate treatment by the utility,” said the coalition’s director of energy policy, Lucas Fykes, in an emailed statement. The industry is “committed to paying its full cost of service,” he added. Amazon derided the power company’s proposal as a “discriminatory and punitive approach” in an April filing with the commission.

Ed. - Cry harder.

https://www.washingtonpost.com/technology/2025/07/10/ohio-data-centers-energy-costs/