Regulators in Ohio, a key data center market, ruled that data centers will have to pay for some of their energy requests regardless of whether the electricity ends up being needed.
The Public Utilities Commission of Ohio on Wednesday voted through a settlement proposed by American Electric Power Co., with some modifications. Under the AEP proposal, facilities would need to pay for at least 85% of the energy they say they need each month even if they use less, helping to fund grid upgrades.
The move comes as the US grapples with how it will generate enough power to run the AI boom. The way that data centers pay for power has become a controversial point as the facilities consume more electricity, forcing costly infrastructure spending on new transmission lines and power plants.
Big tech firms including Amazon.com Inc. had proposed their own terms in Ohio with different requirements. AEP shares closed up about 0.8% in New York.
The rapid growth in power demand from data centers, coupled with the retirement of on-demand power plants, has created an unprecedented challenge for the power grid, Commissioner Dennis Deters said during the meeting. “To meet this challenge we must be acutely aware of the present and future risk to reliability and price stability,” he said.
AEP is one of the biggest power companies in the US and sells electricity to millions of customers in Arkansas, Indiana, Kentucky, Louisiana, Michigan, Ohio, Oklahoma, Tennessee, Texas, Virginia and West Virginia.
Copyright 2025 Bloomberg.
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