Ohio and Oklahoma Propose Laws to Protect Ratepayers from Data Center Costs

Lawmakers in Ohio and Oklahoma are introducing legislation to prevent the costs of expanding energy infrastructure for data centers from being shifted to residential utility customers. Both states are targeting the high power demands of artificial intelligence and cryptocurrency operations to avoid stranded costs if facilities close.

In Ohio, David Thomas and Tristan Rader introduced House Bill 706 to expand a statewide energy tariff model. The bill requires new data centers to sign contracts specifying minimum billing demands and exit fees before construction begins, mirroring a policy by American Electric Power that requires facilities to pay for at least 85% of projected energy use. Thomas stated the measure aims to address local fears that have led some communities to implement data center moratoria. Separately, Governor Mike DeWine has maintained a 100% sales tax exemption for data center construction materials despite legislative attempts to end it.

In Oklahoma, State Representative Brad Boles sponsored House Bill 2992, which requires large load customers to establish separate contracts with electric suppliers and pay for their own infrastructure. To mitigate risk, the bill requires companies to provide collateral and sign 10-year contracts. The urgency for the measure follows a lawsuit by Oklahoma Gas and Electric Company against a cryptocurrency mining center in Poteau over a $1.2 million unpaid electricity bill. While the bill targets new facilities, Representative Jim Greco raised concerns regarding the stability of existing centers.