House passes act to make AI data centers pay for grid upgrades to minimize impact on residents — measure directs states to consider adoption of federal standard within two years of passing

The U.S. House of Representatives just passed a bill that creates a federal standard requiring data centers to pay for grid upgrades made in their favor. H.R. 9340, also known as the Ratepayer Protection Act, amends the Public Utility Regulatory Policies Act of 1978, which would require each State regulatory authority and each non-regulated electric utility to consider the adoption of the bill within two years of its passing, if it is signed into law.

This bill would ensure that data centers with a capacity of 100 megawatts or more would have to pay “the full, incremental cost of any generation, transmission, or distribution upgrade necessary to serve the load of such large-load customer, including in the event of such large-load customer terminating a contract or other agreement with the electric utility pertaining to the sale of electric energy, or otherwise ceasing the purchase of electric energy from the electric utility.” This bill closely follows President Donald Trump’s “Ratepayer Protection Pledge,” where he made AI hyperscalers, utility providers, and state governors promise that they will pay their own way when it comes to their electricity demands. All this stemmed from the surprise price hikes that many residential users and small businesses suffered from because of the massive demand by AI data centers and has become one of the primary reasons why the majority of Americans now oppose data center developments in their communities.

Oregon is actually one of the first states to have taken concrete steps in controlling the utility price increases when it passed the POWER Act in 2025. This law is even more stringent, with any development using more than 20 megawatts required to pay its fair share, and has already resulted in a 30% hike for data center electricity bills and a 1.3% reduction for residential power costs. Virginia has also followed suit soon after its governor signed the Ratepayer Protection Pledge in July 2026, with Virginia’s State Corporation Commission requiring data centers to pay for all required transmission infrastructure.

Even though the House of Representatives has already passed H.R. 9340, it still needs to go through the Senate before finally heading towards the White House for signing by the President. But even if it passes through the remaining hurdles, and the U.S. adopts a federal standard where large data centers pay for grid upgrades done in their name, it’s still up to each state regulator if they will adopt the standard. Furthermore, states have up to two years to make a final decision, meaning there’s a chance that the various temporary data center bans and moratoriums would have expired even before state regulators would have enacted this bill.

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