- AI and data centers are knocking on the states' doors looking to locate their facilities.
- Such centers consume a lot of energy and Utah is looking to be prepared.
- A measure to insulate ratepayers from bearing the costs passed the Senate.
Rocky Mountain Power in Utah does a good job with its demand on energy, but new data centers and AI facilities could challenge the ability to meet electricity needs.
To that end, Sen. Scott Sandall, R-Tremonton, has proposed a measure to insulate current ratepayers against an explosive growth in load demand and allow developers of these centers to operate in a competitive space to find their own energy.
“What we have now is an exponential increase in demand where companies are coming in and wanting to place data centers. They’re wanting to do AI and these large loads are, quite honestly, very hard to service under our normal, current regulated monopoly system that we have in our state. What we’ve done with this bill is we have allowed for loads that are over 50 megawatts to come in and operate in a competitive space, rather than a regulated monopoly space that we typically allow,” Sandall said.
The bill, SB132, was heard on the Senate floor Monday and passed unanimously.
“This would only (apply) in the geographic area of Rocky Mountain Power and allow Rocky Mountain Power to compete in individual contracts,” Sandall said. “It also gives a pathway for outside entities to come in and be service providers for these large loads. As I mentioned with the substitute, one of the biggest sticking points has been we’ve tried to create this wall between the new loads and the existing customer base to make sure that costs don’t get allocated back to regular or normal or existing customers for ramping up in these new large loads.”
Sandall did concede the bill has been through several changes and met with resistance, but he emphasized the compromise it embraces should work and deserves to be heard by their counterparts in the House.
“The part that got real tricky was when the power had to be transmitted from a new producer through the system, the current system, to a new user of over 50 megawatts. When those upgrades need to happen, there will be some benefits that accrue back to the regular customers in increased transmission capability — that space was really hard to navigate.”
He added that if Utah is going to be a competitive player in this arena, it needs to adjust and be ready.
“I think this is a great way to allow our state to be in the forefront in electrical production. And these companies that are wanting to look — they’re looking in all 50 states. And the state that begins to get this right first is going to have the opportunity to have that business here, have that investment — billions of dollars worth of investment comes to our state.”
The bill would make the Utah Public Service Commission the final arbiter of these new loads coming on, Sandall said.
Sen. Derrin Owens, R-Fountain Green, praised the measure during the hearing on the Senate floor.
“These are challenging issues and what I really appreciate is looking out for the taxpayer or the ratepayer, rather than capturing all of the cost when these large loads come on and then put (it) right into a monopoly that already exists. ... So I really appreciate the Legislature and a good sponsor for looking out for that and trying to craft it. I know it’s difficult, but appreciate the work and I’ll be in support.”