House Energy committee hears NCSL briefing on state approaches to data-center energy use

The House Energy and Digital Infrastructure Committee on Feb. 5 heard testimony from the National Conference of State Legislatures on H.727 and how other states are handling the energy implications of data center growth.

Alex McWhorter, a senior policy specialist with NCSL's energy program, told the committee that growing uses for artificial intelligence, cloud computing and cryptocurrency mining are driving construction of high-energy data centers. "Data centers currently account for about 4% of energy consumption in the U.S., but this could double by the end of the decade," McWhorter said, raising concerns about grid capacity and rate impacts for other customers.

McWhorter outlined four broad approaches states have taken. First, several states have required utilities or regulators to assess and, in some cases, create separate customer classes or tariffs so that large loads pay the costs of any transmission or distribution buildout needed to interconnect them. He cited California and Virginia as examples where public utility commissions were asked to study impacts on unrelated customers and said…