U.S. House Energy and Commerce Committee advances data center and permitting legislation

Key Takeaways

The U.S. House Energy and Commerce Committee (E&C) recently took action on legislative proposals addressing both federal permitting reform and the energy demands of data center expansion. As Congress begins the August recess, these actions serve as a preview of the priorities for House E&C Chair Brett Guthrie (R-Ky.) and Ranking Member Frank Pallone (D-N.J.) for the remainder of the 119th Congress. 

Ratepayer Protection Act

On July 21, House E&C approved the Ratepayer Protection Act (H.R. 9340) in a bipartisan 52-0 vote. The legislation would require states to consider adopting a federal standard directing data centers to pay the full cost of the electricity upgrades needed to serve them. This vote comes after E&C members amended the legislation to more narrowly target data centers. Originally, the legislation applied to projects with a peak electricity demand of 100 megawatts or more. As amended, the legislation now applies only to data centers with the respective peak megawatt demand. 

Despite this unanimous approval, committee leadership remains divided on how the federal government should regulate data centers. During the markup of the Ratepayer Protection Act in E&C's Energy Subcommittee, Ranking Member Pallone (D-N.J.) made a surprising announcement endorsing national data center moratoriums while Chair Guthrie (R-Ky.) has previously expressed opposition to national data center moratoriums. 

The Ratepayer Protection Act now awaits consideration in the full U.S. House.

POWER Act

On July 22, House E&C Chair Guthrie (R-Ky.) released a discussion draft of a new permitting reform proposal, the Permitting Our Way to an Energy Resurgence (POWER) Act. The POWER Act is a package of proposals that address aspects of permitting reform that fall under E&C jurisdiction such as pipeline construction, power generation and electricity transmission. 

The POWER Act is one of many permitting reform proposals put forward this Congress. However the outlook for federal permitting reform is still unclear despite the passage of the Standardizing Permitting and Expediting Economic Development (SPEED) Act (H.R. 4776) in December. The U.S. Senate has not considered the SPEED Act or introduced their own permitting reform proposal. NACo will continue to monitor the status of permitting reform legislation when Congress returns from August recess. 

Next steps for counties

With approximately 30 legislative days left in the 119th Congress, there will be many legislative proposals competing for time in committee hearings and on the floor of each chamber. NACo will continue advocating for counties to be recognized as cooperating agencies in federal permitting processes and for the preservation of county siting and zoning authority for developments such as data centers when Congress returns. 

Counties should contact their state utility regulator to discuss how data center expansion could affect energy prices in their state.