The House Voted 417-3 to Make Data Centers Pay, Then Gave States Two Years to Consider It
- FERC & Federal Policy & Markets Regulatory
Marin Holt
- 0
- 9 minutes read
- House vote: 417-3
- Bill: H.R. 9340
- Load threshold: 100 megawatts
- Deadline to complete consideration: 2 years
- Statute amended: PURPA section 111(d)
The US House passed the Ratepayer Protection Act on September 16, 2026, by a vote of 417 to 3. H.R. 9340 does not require any data center to pay for the grid upgrades it triggers. It adds a standard to the Public Utility Regulatory Policies Act of 1978 covering data centers of 100 megawatts or more, then tells state regulators to consider adopting it. They have two years to decide.
What Actually Changed
The bill amends section 111(d) of PURPA by adding paragraph 22. The new standard says a rate charged to a large-load customer shall recover the full, incremental cost of any upgrade needed to serve that load. Generation, transmission and distribution all count. It carries two teeth the trade coverage mostly skipped.
First, cost recovery survives the customer leaving. The text reaches costs incurred if the large-load customer terminates its contract or otherwise stops buying power from the utility. That is stranded-cost protection written into the standard itself.
Second, subparagraph B requires money up front. The utility shall require financial assurances or contributions from the customer, covering the cost of the work, before it builds the upgrade.
A large-load customer is defined narrowly. It is a non-residential consumer signing for facilities that primarily run information technology infrastructure for data storage and computational services. Peak demand must reach 100 megawatts or more, in the aggregate, at a single site or campus.
Why It Matters
For anyone siting a large load, the schedule is the actionable part. Each state regulatory authority and each nonregulated utility has one year from enactment to commence consideration or set a hearing date. Two years is the deadline to complete it and make a determination. That is a proceeding in every state, on a clock.
The financial assurances clause is the one a developer should price now. Terms once negotiated quietly inside a service agreement get argued on a public record, with federal statutory text as the reference. Intervenors will cite it whether or not the state adopts it.
What Did Not Change
No state has to adopt anything. PURPA section 111 obliges a state to consider a federal standard and determine whether to implement it. Declining is a lawful determination.
The bill also leaves the interconnection queue, the capacity market, and the large-load tariffs utilities have already filed exactly where they were. It reaches rates for a defined class of customer, nothing else.
Enforcement Reality
Enforcement runs through state commissions, and the thing enforced is a process, not an outcome. A commission that opens a docket, builds a record, and keeps its current tariff has complied with the statute. PURPA has worked this way since 1978, and its earlier consider-and-determine standards produced a long record of states considering and declining.
ClearView Energy Partners told Utility Dive the bill would largely reinforce transitions already underway, calling it somewhat behind the regulatory curve. In most states this creates a filing rather than a new cost obligation. Michelle Lopes Maldonado of the Center for Data Innovation argued the standard should apply uniformly to any customer at 100 MW or more. The statutory definition supports her point. An aluminum smelter at the same 100 MW sits outside it, because the text reaches only facilities running information technology infrastructure.
Representatives Gabe Evans, a Colorado Republican, and Kathy Castor, a Florida Democrat, co-sponsored the bill. Energy and Commerce reported it out on September 10 as House Report 119-814. The three votes against came from Representatives Summer Lee of Pennsylvania, Delia Ramirez of Illinois, and Rashida Tlaib of Michigan. The Senate has its own data center bills and has moved none of them.
Critical Perspective
A consider-and-determine standard is the weakest instrument PURPA offers, and Congress reached for it knowingly. The financial assurances clause is the part with real money attached, and it sits inside the same paragraph states are free to decline. A commission that likes its existing large-load tariff keeps it, files the determination, and the up-front contribution requirement never binds anyone in that state.
The definition invites the obvious workaround. The standard reaches facilities that primarily run information technology infrastructure at 100 megawatts or more. A load of the same size doing something else sits outside it, and the boundary between a data center and a mixed-use industrial campus is drawn by the applicant’s own description of what the site primarily does.
Then there is the timing. The vote landed on the House’s last day in session before the November 3 midterms, 417 to 3, with the Senate holding its own data center bills and moving none of them. A bill that obliges states to hold a hearing costs a member nothing to support. The test of whether this was policy or positioning is whether the Senate takes it up after the election.
Sources
- GovInfo – H.R. 9340 as reported in the House
- Congress.gov – H.R.9340 Ratepayer Protection Act
- NBC News
- Utility Dive
