U.S. House Votes to Push States to Make Big Tech Pay for AI Data Center Power Costs

The U.S. House of Representatives has moved to shift the cost of electricity rate increases caused by data center construction onto the Big Tech companies that use them. With community pushback over the spread of artificial intelligence data centers emerging as an issue ahead of the midterm elections, Congress is acting to ease the burden on ordinary households.

The House passed the Electricity Ratepayer Protection Act on the 16th by a vote of 417 to 3, according to Reuters and other outlets.

The bill creates guidelines for large power consumers. It defines non-residential customers with peak electricity demand of 100 megawatts or more at a single site as "large load customers" and directs that rate structures be designed so those customers bear the additional costs of expanding generation, transmission and distribution facilities. State authorities must review and make a final decision on whether to adopt such rate structures within two years of the law taking effect.

Data centers are seen as critical infrastructure that will determine U.S. leadership in AI, but residents in areas where the facilities are built have voiced growing complaints about rising electricity bills and water depletion. Axios noted that Congress has produced a visible response to a political issue that has surged to prominence ahead of the midterm elections, calling it the most significant step Congress has taken to protect consumers from infrastructure costs driven by the AI boom.

Some question how much the measure will accomplish. Because it goes no further than recommending that state governments review whether data centers should shoulder the costs, its enforcement power is limited.

As controversy over data centers grows, Big Tech companies are also preparing responses. Google and Nvidia have joined with grid management startup Emerald AI to launch the AI Energy Management Alliance, or AEMA, aimed at flexibly adjusting data centers' power demand. The alliance, which includes about 20 companies and institutions such as Anthropic, aims to convert data centers into facilities that shift consumption to hours when electricity use is low.