Senate committee advances bill directing PUC to set rates for very large energy users; amendment clarifies payments and direct access

The Oregon Senate Committee on Energy and Environment on May 14 voted to advance House Bill 3546A, as amended, to the full Senate with a “do pass” recommendation after adopting the A‑7 amendment. The bill directs the Oregon Public Utility Commission to establish a classification and contract framework for very large energy use facilities and requires biennial reporting to the Legislature.

Representative Pam Marsh, the bill sponsor, told the committee the measure is “designed to make sure that certain of our very large energy users pay the cost of their own power. We're not asking them to subsidize other people.” Marsh said the bill would let the PUC create a special rate class for those users, require long‑term contracts for new facilities and use data to calculate cost‑based rates.

The bill defines a “large energy use facility” as one with a contracted demand of 20 megawatts or more and ties that definition to industry classifications; legislative staff noted the definition captures data centers and crypto‑mining operations as identified by NAICS codes. The A‑7 amendment, adopted in committee, clarifies that minimum contract payments will be based on projected usage for the electricity services the electric company contracts to provide and that a utility may include charges for excess demand on those contracted services. The amendment also clarifies that the act does not restrict facilities from using PUC‑approved direct access arrangements.

Marsh said two stakeholder changes were included in the A‑7 language: edits requested by the Northwest and Intermountain Power Producers Coalition (NPSI) to ensure direct‑access customers are not double‑charged, and a clarification requested by data centers allowing alternative green power or renewable tariffs as permissible pathways. Marsh said the PUC will set rates using data and that data centers could participate as intervenors in the rate‑setting process.

Several senators voiced concern about singling out the data center industry. Senator [name recorded in transcript] asked why the bill targets data centers and crypto‑mining specifically rather than all very large users. Marsh replied the industries targeted have produced rapid, concentrated growth and “are putting this enormous stress” on the grid in ways she said other large users have not demonstrated. Another senator said she is “personally concerned” about singling out one industry and would prefer a broader approach that examines large users in general.

Committee discussion also noted that utilities have already documented costly upgrades in some local service territories related to new, high‑capacity customers. Proponents argued the PUC needs statutory tools to assign cost responsibility and to reduce the risk of stranded assets for other ratepayers.

The committee adopted the A‑7 amendment on a voice vote and moved the bill to the floor with a do‑pass recommendation. A roll call on the do‑pass motion recorded Aye votes from Senators Wilson, Benn and the chair; No votes from Senator Robinson and the vice chair; the motion carried.

Representative Marsh and committee members said the PUC remains the primary arbiter for rate design and that affected facilities may challenge PUC rate orders in court under existing administrative review processes. Marsh said the bill includes a ten‑year contract expectation for new facilities to align with long‑term infrastructure investment.

The bill record on OLIS shows two amendment drafts (A‑6 and A‑7) discussed in committee; the A‑6 draft adjusts the large‑user definition and contract language, while the A‑7 text incorporated the projected‑usage payment language and direct‑access clarification. The committee’s action sends the amended bill to the Senate floor for further consideration.

The committee’s discussion included repeated references to the role of NAICS industry codes in the bill’s definition, the PUC’s ability to implement cost allocation practices, and stakeholder involvement from investor‑owned utilities, consumer advocates and affected industries.

Next steps: the bill will proceed to the Senate floor under the due‑pass recommendation. The PUC would be required by the bill to submit a report to the Legislature (statutory date language in the bill requires reports by Sept. 1 of even‑numbered years), and affected parties would have the administrative processes available to challenge PUC orders.