Large Loads
David Springe is Executive Director of the National Association of State Utility Consumer Advocates.
At the various regulatory gatherings I attend, I often hear speakers talk about protecting residential and small commercial customers from the cost of meeting the new capital and operational requirements imposed by large load customers, like data centers. Serious concern is expressed about the affordability of utility rates, often followed by the optimistic view that revenue from new large load customers can put downward pressure on utility rates.
My new catchphrase when I speak at these gatherings, which I encourage others to adopt, is “growth has to pay for growth.” Or more specifically, the revenue from serving the large load customer must be equal to or greater than a hundred percent of the direct and indirect cost of serving that customer — otherwise costs are being pushed to other customers. It also goes without saying that service should not be negatively impacted for other customers.
I’ve been pleased to see the progression of state actions that attempt to reduce the risk that rates go up for residential and small commercial customers as utilities spend capital to meet the requirements of large load customers.