Senate committee hears arguments that data‑center buildouts risk shifting billions in grid costs onto residential customers

The Senate Regulated Industry Committee held extended testimony on SB34 and a committee substitute that would limit when utilities can place costs associated with serving large‑load customers, such as data centers, onto residential and retail customers.

A sponsor (S8) framed the substitute as a set of contract protections—minimum billing, credit and termination provisions—between utilities and large‑load customers. The sponsor argued that the substitute does not, in his view, go far enough because it omits provisions that would more directly prohibit cost‑shifting to residential customers.

Bob Cherrier, an attorney with the Southern Environmental Law Center, told the committee that the commission’s existing contracting scheme leaves gaps. He said Georgia Power has secured certifications and begun planning capacity expansions that could total thousands of megawatts and tens of billions in capital, and that the contracts filed in practice sometimes require only two years of termination payments rather than the longer minimums the commission discussed. "If a data center leaves early…more than a decade's worth of bills could go unpaid," Cherrier said, arguing the committee should retain statutory protections so those costs do not fall to households.

Liz Coyle, executive director of Georgia Watch, said PSC certifications authorizing major build‑outs could expose customers to multi‑billion dollar obligations if demand does not materialize, and urged lawmakers to take a protective approach that preserves the right of the commission to set rates while adding statutory limits on cost shifting.

Dr. Conrad Hayashi and Dr. Amy Sharma presented independent technical and forecasting perspectives. Hayashi warned of fiscal and public‑health implications from rapid, capital‑intensive build‑outs and described the risk of a data‑center ‘‘bubble’’ combined with a financing model that socializes costs and privatizes returns. Sharma summarized a Greenlink Analytics study and forecasts from international energy agencies and said the committee’s scenario of tens of gigawatts of new demand was likely overstated—she said independent forecasts showed much lower probabilities of the largest build‑out scenarios.

Committee members debated whether the contract‑focused approach (codified terms in each utility‑customer agreement) would adequately protect retail ratepayers, or whether statutory language forbidding the allocation of those costs onto residential rates is necessary. Some members cautioned that rate‑setting authority lies with the Public Service Commission, while other senators argued the legislature can and should set guardrails to prevent hidden cross‑subsidization.

The committee did not vote. The chair said he had invited Georgia Power, the Public Service Commission and other parties to provide input and asked staff to work with senators to try to perfect substitute language. The hearing was adjourned pending additional meetings and stakeholder briefings.