The bill, sponsored by Reps. Gabe Evans (R-Colo.) and Kathy Castor (D-Fla.) cleared the House Energy and Commerce Committee by a 52-0 vote in July and is expected to come up under suspension of the rules during the week of September 14, the House Majority Leader's floor schedule shows. It amends the Public Utility Regulatory Policies Act of 1978 rather than setting a nationwide rate. Instead, PURPA gives Congress a framework to require state utility regulators to consider a federal standard, leaving the actual rate-setting where it has always sat, with the states.
Under that standard, a large-load customer, defined as a nonresidential facility using at least 100 megawatts at a single site primarily for data storage and computing, would have its rates designed to recover the full incremental cost of the generation, transmission, and distribution upgrades built to serve it. Utilities would also need financial assurances from the customer before building that infrastructure, a direct response to concern over speculative load forecasts that leave ratepayers exposed if a project is delayed or scaled back. Regulators would get one year to begin considering the standard and two years to complete it, though states that have already adopted or actively considered similar cost-recovery rules would be exempt from starting over.
Federal Regulators Are Already Pressing on the Grid Side of This
H.R. 9340 attacks the cost question from the retail-rate side. The Federal Energy Regulatory Commission is working the wholesale side of the same problem. In June, FERC ordered all six regional grid operators under its jurisdiction to justify or reform their rules for interconnecting data centers and other large loads, with cost-shift prevention named as one of the consumer protections the commission wants addressed. A companion bill in the Senate, S. 5028 from Sen. Jon Husted (R-Ohio), gives the underlying cost-allocation concept a path beyond the House, though it has yet to draw a committee hearing.
Most States Are Not Waiting on Washington to Answer This
The exemption for states with a comparable standard already in place matters because so many states qualify. Twenty-three states have put some version of cost-causation rules in place for large-load customers, and Texas built an entirely new framework, ERCOT's Batch Zero system, to sort out who gets grid access and who pays for it. H.R. 9340 would formalize a policy direction most of the country has already chosen rather than impose one from scratch.
Paying for infrastructure is only half the equation. A developer can commit to covering every dollar of a transmission upgrade and still wait years for permitting, equipment, and construction, which is why on-site generation arrangements are gaining traction alongside the cost-allocation fight as a way to get large loads online faster. With 41 co-sponsors and unanimous committee support behind it, H.R. 9340 looks likely to clear the House this week. Whether it clears the other chamber, where Husted's companion bill has not yet drawn a committee hearing, is the next thing worth watching.
