Protect Communities While Embracing Innovation
America must beat China in the artificial intelligence race, and we can do so without letting data centers harm our communities. Recent surveys have found Americans increasingly worried about data centers, which power AI’s immense processing requirements. Data centers are essential to our 21st century economy, but we can prevent these new facilities from raising our utility bills, disrupting the water supply, or spoiling neighborhood beauty. Mississippi is proving that we can avoid all those risks and still capitalize on the economic potential of data centers.
Senate Dems Block Data Center Bill
Twice last month, Senate Republicans tried to pass a bill that would begin addressing Americans’ concerns about data center costs. The legislation, the Ratepayer Protection Act, would codify a framework the Trump administration has established with major tech companies. The bill would set standards that states can consider to make data center companies, not local residents, responsible for any extra energy costs.
The Ratepayer Protection Act follows three principles. First, data centers should foot the bill for any power grid upgrades their facilities require. To accommodate data centers’ power needs, some providers have built new lines or constructed new generating stations. The community should not be on the hook for those improvements.
Second, states should ensure that data centers do not compel energy companies to overbuild. Power grid upgrades are costly and are paid for over time. If a data center company requests these upgrades but then leaves town or closes, everyday customers should not be left paying for their infrastructure improvements.
Finally, though the bill recommends these principles, it ensures that states can set the rules that are best for their communities.
The Ratepayer Protection Act sailed through the House of Representatives by a huge bipartisan margin of 417 to 3. Unfortunately, when it got to the Senate, nearly every Democrat voted no. In the name of political expediency, they blocked a solid first step that had widespread support.
Mississippi Economy Benefiting
Though Senate Democrats refused to make progress on this issue at the federal level, Mississippi has required no such nudging. The Magnolia State has become a model for effective collaboration among data centers, state leaders, power companies, and local residents. Mississippi’s energy costs have generally tracked with inflation over the past five years. In other words, they have not risen because of data centers. Instead, data centers have actually been a boon to the state’s economy and to residents’ energy bills.
For example, consider the partnership between Amazon, power company Entergy, and state leadership. Amazon has opened several data centers in Mississippi, and Entergy supplies power to them. When Amazon built its data centers in the state, it worked with Entergy and state leaders to develop a utilities contract that benefits everyone.
Under this model, the data center pays 100 percent of the costs associated with its data center operations. This provides new income for the power company, paying dividends for Mississippi. Thanks in part to these earnings, the power company can invest hundreds of millions of dollars in the state’s power grid. These upgrades will reduce power outages, increase energy efficiency, and make the grid more resilient during bad weather. Without this agreement, regular households and businesses could end up paying for these infrastructure improvements—increasing utility rates for the average customer. But income from data centers can help power companies keep rates from rising—even as they make improvements that will benefit our power grid for years to come.
Win AI to Win the Future
The fact is this: The nation that wins in AI will lead the 21st century. Yet without data centers, the United States won’t stand a chance at victory. In any technological leap, our government must ensure the community is protected, and we must lead in innovation. Mississippi shows that we can work together to do both.
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