Oregon lawmakers are considering a bill that would require certain large energy users, like data centers and cryptocurrency businesses, to pay their share for electricity use. Advocates say it could help bring down energy bills for residential ratepayers who have taken on more than their share of the cost of substantial energy use by these entities in recent years.

But a trillion-dollar corporation that owns data centers in Oregon says the bill should be expanded to all large energy users. Officials from that company — Google — suggested changes to the bill, and said they are willing to collaborate with lawmakers.

On Thursday, lawmakers from the House Committee on Climate, Energy and Environment held a public hearing for House Bill 3546, or the POWER Act — short for “Protecting Oregonians With Energy Responsibility.” The bill would create a new classification for data centers, cryptocurrency and other large industrial energy users using more than 20 megawatts, or 20 million watts of power.

One megawatt could power between 400-1,000 homes, depending on the power source and electricity consumption within the home.

The new classification allows regulators to make sure these large energy users pay their fair share of energy use to serve their demand.

“House Bill 3546 ensures that electricity utility ratepayers already overloaded with growing costs due to wildfire mitigation, erratic weather events and inflation are not also saddled with costs attributed to new large users that are putting enormous strain on the system,” Rep. Pam Marsh, D- Southern Jackson County, said.

Marsh, who is the chief sponsor of the bill, said the POWER Act would not lead data centers to subsidize other energy users, but would ask them to pay their fair share.

“As a technology consumer, I am well aware that every time I open my laptop or text something on my phone or flirt with the idea that maybe someday I’ll figure out how to use AI, I’m benefiting from a data center somewhere. I should and will undoubtedly pay for those services in my role as a tech consumer. that’s appropriate,” she said. “But the energy costs incurred in selling technology services should be part of the calculation of running that business, not foisted onto utility ratepayers who are struggling to pay their own bills.”

Currently, the Oregon Public Utilities Commission has six customer categories that split the costs of things like adding new transmission to the power grid. Those categories include residential, commercial and industrial customers.

Data centers fall under the industrial customers category. But data centers have more than outgrown the pace of the current system of categories as they use massive amounts of energy and are frequently popping up across the state. There are currently 131 data centers in Oregon, according to Data Center Map’s database.

Consumer advocacy group Oregon Citizens’ Utility Board reports that Portland General Electric has seen data center electric load grow so much over a five-year period, it’s the equivalent of providing power to more than 400,000 new people to their system. In that same time frame, PGE has added about 61,000 people to their system.

Oregon CUB’s executive director, Bob Jenks, said that’s a dramatic growth in data center load on the PGE system. It was essentially non-existent a decade ago and is at more than a million-megawatt hours today.

“Over the last 10 years, PGE’s load would’ve shrunk if it wasn’t for the growth of this new large load. There has been growth in other customer classes, but it’s been fully offset by energy efficiency investments,” he said. “Historically, we’ve never seen a period where all the growth on a utility system was confined to a single customer group.”

Jenks compares some data center loads to the power used by the city of Ashland. He said some new data centers plugging into the grid use more power, equivalent to the energy load of the city of Eugene.

“Think about what the infrastructure would take to accommodate a new Ashland or five Ashlands or 15 Ashlands over the next two or three years. The roads, the sewers, the water, think about trying to accommodate a couple new Eugenes that suddenly appear,” he said. “That’s what the electric system faces, except it is not roads to move cars, it’s transmission to move electrons. It’s a new power supply and new battery storage and it comes on quickly. Meeting the loads of the data centers is going to be expensive.”

Large industrial users, like data centers, that have connected to PGE’s system pay about 2 cents per kilowatt hour, or kWH, which is the unit of energy used when 1,000 watts of power is used in an hour. Residential customers in the same PGE system pay close to 8 cents an hour, according to Oregon CUB.

People are reeling from recent rate hikes, with many of PGE’s and Pacific Power residential customers paying about 50% more on their energy bills now than five years ago. Between January and October of last year, PGE disconnected more than 32,000 customers for nonpayment.

HB 3546 would also require large energy users to sign a 10-year contract that commits them to pay a minimum amount for energy used as well as pay for adding new transmission. The contract could also include charges if an excess amount of energy is used.

The bill would affect Portland General Electric, Pacific Power and Idaho Power customers in Oregon.

Rep. Virgle Osborne, R-Roseburg, said he’s concerned the proposed bill could unintentionally impact businesses by shifting costs back to them, cutting into their profits, and may deter them from doing business in Oregon.

“If we make business so hard to do here, we’re not going to have business, and frankly we could use the manufacturing here in Oregon,” he said. “So, I understand we need to take care of the citizens, and we need to take care of our constituents, and they need to have decent prices on electricity, but the reason they have jobs is because of those businesses that come here and hire them.”

Companies like Google, which has operated a data center in The Dalles since 2006, suggested changes to the proposed bill. Ellen Zuckerman, Google’s head of energy market development for North & South America, said the company could offer a different framework that “positions Oregon for success over the long haul” and focuses on all new large growth drivers instead of just one industry.

“We’re here today because we really want to work with you on this bill and are here as collaborators,” she said. “We believe that the opportunity for load growth presents incredible economic advantages for the state. It also presents challenges, and we really want to work with you all and meet the moment on a solution that’s everlasting and can really capitalize on Google as a catalyst to help us collectively invest in our power system.”

That Google-backed framework includes signing an eight to 12 year contract with utilities to ensure new loads will come on to their system, and commits those new large energy users to paying a minimum infrastructure charge. Zuckerman said that approach makes investment needed in the utility system less risky, and if a large energy-using company decides to leave the state, utilities would still get paid for the amount of energy the company would have used.

“We want to see a similar model adopted here,” Zuckerman said. “…We think it sends a signal to our utility partners that we are here to stay, but also that we are here to de-risk the investments that they have to make.”

People can submit public testimony on HB 3546 up until 48 hours after the start time of the committee hearing.

News Source : https://www.opb.org/article/2025/03/06/power-act-data-centers-electricity-use-oregon-lawmakers-energy-google-utilities/