Democrats made a potentially big miscalculation on Wednesday that Republicans will no doubt attempt to take advantage of as they campaign for reelection.
Senate Democrats blocked a Republican-led effort Wednesday to advance legislation aimed at preventing households and small businesses from being stuck with electricity infrastructure costs generated by the nation’s rapidly expanding data-center industry.
The Senate voted 57-43 to advance the Ratepayer Protection Act, falling three votes short of the 60 needed to overcome the procedural hurdle.
Four Democrats — Sens. Maggie Hassan of New Hampshire, Amy Klobuchar of Minnesota and Georgia Sens. Jon Ossoff and Raphael Warnock — joined Republicans in supporting the measure. The remaining 43 Democrats voted against it.
The defeat came just two weeks after the House approved the legislation in a lopsided 417-3 vote, with overwhelming support from Republicans and Democrats.
The bill, H.R. 9340, is designed to address concerns that ordinary electricity customers could be forced to subsidize billions of dollars in new power plants, transmission lines, substations and other infrastructure needed to serve massive data centers.
Under the legislation, state utility regulators would be required to consider standards making large-load customers responsible for the full incremental costs of infrastructure built specifically to serve them.
The proposal generally targets facilities requiring at least 100 megawatts of peak electricity demand.
Sen. Jon Husted, R-Ohio, has championed the legislation in the Senate and argued that rapidly expanding technology companies should pay for the additional electricity infrastructure they require rather than shifting those costs onto existing customers.
“We have to make sure that the growth of these data centers does not mean higher electric bills for working families, for senior citizens or for small businesses,” Husted said before the vote.
“The companies driving this growth should be held responsible for the power they need to operate, not the American ratepayer,” he added.
Senate Democrats’ excuse — which was not shared by the vast majority of House Democrats — was that Husted’s legislation does not go far enough.
The Ratepayer Protection Act would require state regulators to consider the federal standard and decide whether to adopt it. It would not require states to ultimately implement the protections.
Senate Minority Leader Chuck Schumer, D-N.Y., seized on that distinction.
“The bill is a fraud,” Schumer said. “I can sum up the shortcomings of Republicans’ data center bill with one word: optional. An optional guardrail is not a guardrail at all,” he added.
Sen. Martin Heinrich, D-N.M., has promoted a competing proposal known as the GRID Savings Act.
That legislation would direct the Federal Energy Regulatory Commission to establish rules requiring large electricity users such as data centers to cover certain costs associated with connecting their facilities to the power grid.
“This is nothing more than a messaging bill on the eve of an election,” Heinrich said of the Republican-backed measure. “Congress needs to pass legislation with real teeth.”
Husted rejected that argument, noting that states traditionally play a major role in regulating electricity utilities.
“The federal government doesn’t run the grid,” Husted said. “The states run the grid. You have to do it in a collaborative process with the states.”
The fight comes as the artificial-intelligence boom drives a dramatic expansion in data centers and the electricity required to operate them.
Lawrence Berkeley National Laboratory has estimated that data centers could consume between 9.5% and 15.3% of U.S. electricity by 2030.
Utilities facing that surge in demand may need to build new generating capacity and transmission infrastructure. The political question increasingly confronting lawmakers and state regulators is how much of those costs should be borne by the technology companies creating the new demand rather than existing electricity customers.
The issue has also emerged as a significant factor in the midterm elections.
Husted is seeking a full Senate term in Ohio against former Democratic Sen. Sherrod Brown, and electricity prices and data-center development have become prominent issues in the race.
Republicans argued Wednesday’s vote gives them a clear contrast to take to voters.
“Now they own it,” Husted said after the bill failed, accusing Democrats of obstructing an effort to address electricity prices.
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