Guest Blog: Connecting Data Centers to the Grid: An Innovative and Controversial Proposal from AEP Ohio

Concerns about the growth in data centers and the associated increases in power demand have received substantial press coverage. As the scale of the burden that data centers impose on the electricity grid becomes clearer to the public, more and more people are asking the unavoidable question: who will pay for the grid upgrades needed […]Concerns about the growth in data centers and the associated increases in power demand have received substantial press coverage. As the scale of the burden that data centers impose on the electricity grid becomes clearer to the public, more and more people are asking the unavoidable question: who will pay for the grid upgrades needed to support these facilities? One Ohio-based utility recently imposed a moratorium on new data center applications and put forward a novel proposal that it says will ensure data centers pay for the costs they impose on the grid, but the application is facing strong pushback from data center operators, blockchain groups, and competitive power suppliers. Opponents argue that the proposal violates the utility’s duty to provide service on a non-discriminatory basis; the utility – Ohio Power Company (AEP Ohio) – disagrees. As data centers continue to expand across the nation,