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America’s electric grids are aging and struggling to meet surging demand from AI data centers. As artificial intelligence continues to advance, more data centers will be needed to keep the technology growing, but who will pay the extra utility costs? That is one of the questions Americans and the federal government are trying to figure out. However, a bill that would have helped address that problem – and steer costs toward the companies building large data centers – failed to pass the Senate on Wednesday, Sept. 30, with all but four Democrats voting against it.
Affordability Bill for Data Centers Blocked
On Sept. 16, the House passed the bipartisan Ratepayer Protection Act with a 417-3 vote. It was designed to address concerns about the financial impact data centers have on consumers, but Democrats blocked it in a 57-43 vote. In a discussion with Newsmax on Wednesday, Sen. Jon Husted (R-OH), the bill's sponsor, implied that voting against it was a political move ahead of the midterms, saying Democrats "don't want us to be successful in addressing the affordability issue." He is currently fighting in a special election to keep his seat.
“You all know this is the only game in town,” Husted told reporters before the vote. “This bill passing is the only way to get a chance to prove to the American people before the midterm elections whose side you’re on.”
Opponents, however, claim it doesn’t have any teeth. The measure would require states to consider standards that require large data centers to cover the full cost of incremental grid upgrades.
Senate Minority Leader Chuck Schumer (D) told reporters on Tuesday that Republicans were “putting a bill they know will fail to try and secure political points instead of delivering real relief. While Americans are demanding real guardrails on AI and data centers, Republicans are offering a toothless messaging bill.”
Are the Critics Right?
The proposed bill applies to very large electricity users, including data centers with demand exceeding 100 megawatts. It would amend the federal Public Utility Regulatory Policies Act (PURPA) to require state utility regulators to consider establishing a “large-load” standard for those customers. In other words, states would have to consider such a standard but would not have to adopt it.
Under such a standard, if a utility needs $500 million in additional power infrastructure because of data centers, the tech company creating that demand would pay those costs instead of ordinary customers.
According to the Department of Energy, data centers in the US consumed about 176 terawatt-hours of electricity in 2023. That represented about 4.4% of all electricity used in the United States. For comparison, they consumed about 58 terawatt-hours in 2014, meaning their electricity use roughly tripled in less than a decade.
Republicans and Democrats seem to agree that the cost these power users create shouldn’t rest on the average citizen’s shoulders, but the two parties can’t agree on how to handle the situation. President Donald Trump is an avid supporter of data centers and AI advancement. When a reporter asked whether he wanted to see the facilities in neighborhoods and communities, he floated the idea of giving dividend checks to people living near them.
The bill failed in part because critics argued that encouraging states to act doesn't guarantee they will. Democrats are proposing the GRID Savings Act, which they say would require large data centers to pay the full cost of grid upgrades needed to serve them.
Although both parties believe the average citizen shouldn’t bear the costs, a solution may be off the table for a while because Congress will be out of session as midterm elections approach, meaning the Ratepayer Protection Act could be delayed as the lame-duck session begins.
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