Reps. Rader, Thomas Introduce Bipartisan Bill to Shield Ohio Ratepayers from Data Center-Driven Grid Costs

COLUMBUS — State Reps. Tristan Rader (D-Lakewood) and David Thomas (R-Jefferson) today announced bipartisan legislation to establish minimum statewide standards for electric service agreements with data center customers. The bill would ensure costs of new infrastructure and grid upgrades needed to serve these facilities are not shifted onto existing Ohio ratepayers.

Ohio has seen rapid growth in energy-intensive development, including data centers, that often require significant transmission and distribution upgrades. The proposed legislation provides guardrails to support responsible development, while shielding other customers from rate impacts.

“This bill is about protecting Ohio consumers,” said Rep. Rader. “Data centers may bring jobs and investment, but their massive electricity demand can also drive major grid costs. Working families and small businesses should not be forced to pick up the tab for private infrastructure built to serve some of the largest corporate customers in the world. These standards ensure that if these projects move forward, they do so responsibly, transparently, and without increasing rates for everyone else.”

“This is a commonsense approach that supports economic development while protecting consumers,” said Rep. Thomas. “Data centers are an important part of Ohio’s future, and we want to continue attracting them. At the same time, utilities and regulators need clear rules so that grid investments are planned responsibly and existing customers are not left holding the bag.”

The proposal builds on consumer protections already being implemented in AEP Ohio’s service territory, through a PUCO-approved tariff. AEP has reported that early results from this tariff structure are “working as designed.” This legislation would apply those same safeguards statewide, ensuring consistent safeguards for ratepayers across Ohio.

The bill would require data center customers to enter into long-term service agreements with electric utilities before utilities construct dedicated infrastructure. It also directs the Public Utilities Commission of Ohio (PUCO) to establish standards for interconnection queue practices, load study deposits, and milestone requirements.

Additional bill provisions include the following:

• Prohibiting electric utilities from recovering data center associated costs from other customer classes;
• Minimum contract commitments of twelve years and minimum billing standards;
• Financial assurance requirements before the construction of dedicated facilities; and
• Return of exit payments or unused-capacity charges to customers
   

The legislation has so far received bipartisan support and was introduced today.

EDITOR’S NOTE: A picture of Reps. Rader and Thomas introducing the bill is attached to this press release. Courtesy: Ohio House Democrats.