Senate committee advances bill narrowing PUC siting review for on‑site backup generation

Pierre — The Senate Commerce and Energy Committee voted to advance Senate Bill 193 with a due‑pass recommendation after contentious testimony about whether the state’s PUC siting process should apply to on‑site backup generation.

Sponsor Senator Casey Crabtree and proponents from data centers and utilities groups argued the bill clarifies that backup generation located on a customer’s site and not connected to the grid should not require a Public Utilities Commission siting permit even when rated above the 100‑megawatt threshold. Industry witnesses said on‑site backup protects workers and equipment and that environmental and local ordinances (noise, emissions) would continue to apply.

The Public Utilities Commission’s chairman, Chris Nelson, opposed the bill and urged defeat. He said the siting statute (49‑41B) applies to any facility at or above the megawatt threshold regardless of ownership or grid connection and that exempting a category creates a disparity: an identical 500‑megawatt facility could be exempt when built as customer backup but would require PUC review if built by a utility. He also warned of facilities built initially as ‘backup’ later being used to sell into the grid without having undergone the PUC’s environmental and public‑interest review.

Committee members split but voted 5‑3 (one excused) to advance the bill; proponents said federal emissions and local permitting would remain in force and that the bill aligns South Dakota policy with other business‑friendly states that do not apply statewide siting to on‑site backup generation.