Senate Committee rejects bill to allow 'behind-the-meter' power for data centers

The Oklahoma Senate Energy Committee voted 4-7 to reject Senate Bill 1003, a proposal to allow large data centers to use on-site generation that remains islanded from investor-owned utility grids.

Senator Frank Jett, the bill’s initial presenter, said the measure was aimed at attracting data centers that have been turned away because investor-owned utilities lack capacity to serve them. "One of the problems is that the IOUs won't build a station for these data centers because they take up so much energy," Jett said during committee discussion.

Supporters told the committee the measure would allow companies to bring their own energy behind the meter so the local investor-owned utility’s rates and reliability evaluations would not be affected. Jeff Rush, an official with the Oklahoma Corporation Commission (OCC), told the panel that the proposal would not affect cooperative or municipal utilities that are outside OCC jurisdiction so long as the on-site generation remained a true island. "As long as it's a true island, then there's no commission involvement," Rush said, adding that any later interconnection would trigger OCC oversight and planning with the Southwest Power Pool (SPP).

Committee members pressed on the bill’s technical limits. Senators asked whether behind-the-meter generation could later be connected to the grid and whether the bill’s language would allow only a single on-site generation source. Jett said the version before the committee was not the OCC-reviewed rewrite and that he had moved to "strike the title" while working with the commission; he also said an OCC assessment line in the draft would be removed. "That's why I struck title, and we're working with them," he said.

Opponents said the bill as discussed risked creating islands that could complicate planning and longstanding reliability rules. After debate the clerk called the roll and the committee recorded 4 ayes and 7 nays; the chair declared the bill failed.

The committee hearing combined technical testimony from OCC staff and extended senator-level debate about regulatory jurisdiction, economic development needs and grid reliability. There was no floor-level amendment or substitute recorded before the committee vote, and the committee did not advance the bill.