Little Hoover Commission hearing spotlights data center risks to California rates, water and grid planning

The Little Hoover Commission convened the first of two hearings on data centers and California electricity policy, hearing testimony from ratepayer advocates, grid researchers, environmental justice experts and national lab researchers about the potential costs and community impacts of rapid hyperscale data center growth.

Elise Torres, assistant managing attorney for the Utility Reform Network (TURN), told commissioners that utilities’ interconnection and upgrade costs for large data center loads become part of the utility rate base and are ultimately paid by customers. Citing PG&E filings, Torres said the company forecasts as much as 10 gigawatts of data center demand in coming years and that PG&E’s estimates imply substantial capital spending—Torres summarized the range conveyed in filings as roughly $0.5 billion to $1.6 billion of grid and generation investment per gigawatt—creating a material risk of higher rates for residential and small-business customers.

The witnesses and commissioners discussed the distinction between transmission and distribution…