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Q&A

Could Blocking Data Centers Raise Electricity Prices?

A conversation with Advanced Energy United’s Trish Demeter about a new report with Synapse Energy Economics.

Trish Demeter.
Heatmap Illustration

This week’s conversation is with Trish Demeter, a senior managing director at Advanced Energy United, a national trade group representing energy and transportation businesses. I spoke with Demeter about the group’s new report, produced by Synapse Energy Economics, which found that failing to address local moratoria and restrictive siting ordinances in Indiana could hinder efforts to reduce electricity prices in the state. Given Indiana is one of the fastest growing hubs for data center development, I wanted to talk about what policymakers could do to address this problem — and what it could mean for the rest of the country. Our conversation was edited for length and clarity.

Can you walk readers through what you found in your report on energy development in Indiana?

We started with, “What is the affordability crisis in Indiana?” And we found that between 2024 and 2025, residential consumers paid on average $28 more per month on their electric bill. Depending on their location within the state, those prices could be as much as $49 higher per month. This was a range based on all the different electric utilities in the state and how much residents’ bills are increasing. It’s pretty significant: 18% average across the state, and in some places, as high as 27% higher year over year.

Then Synapse looked into trends of energy deployment and made some assumptions. They used modeling to project what “business as usual” would look like if we continue on our current path and the challenges energy resources face in being built in Indiana. What if those challenges were reduced, streamlined, or alleviated to some degree, and we saw an acceleration in the deployment of wind, solar, and battery energy storage?

They found that over the next nine years, between now and 2035, consumers could save a total of $3.6 billion on their energy bills. We are truly in a supply-and-demand crunch. In the state of Indiana, there is a lot more demand for electricity than there is available electricity supply. And demand — some of it will come online, some of it won’t, depending on whose projections you’re looking at. But suffice it to say, if we’re able to reduce barriers to build new generation in the state — and the most available generation is wind, solar, and batteries — then we can actually alleviate some of the cost concerns that are falling on consumers.

How do cost concerns become a factor in local siting decisions when it comes to developing renewable energy at the utility scale?

We are focused on state decisionmakers in the legislature, the governor’s administration, and at the Indiana Utility Regulatory Commission, and there’s absolutely a conversation going on there about affordability and the trends that they’re seeing across the state in terms of how much more people are paying on their bills month to month.

But here lies the challenge with a state like Indiana. There are 92 counties in the state, and each has a different set of rules, a different process, and potentially different ways for the local community to weigh in. If you’re a wind, solar, or battery storage developer, you are tracking 92 different sets of rules and regulations. From a state law perspective, there’s little recourse for developers or folks who are proposing projects to work through appeals if their projects are denied. It’s a very risky place to propose a project because there are so many ways it can be rejected or not see action on an application for years at a time. From a business perspective, it’s a challenging place to show that bringing in supply for Indiana’s energy needs can help affordability.

To what extent do you think data centers are playing a role in these local siting conflicts over renewable energy, if any?

There are a lot of similarities with regard to the way that Indiana law is set up. It’s very much a home rule state. When development occurs, there is a complex matrix of decision-making at the local level, between a county council and municipalities with jurisdiction over data centers, renewable energy, and residential development. You also have the land planning commissions that are in every county, and then the boards of zoning appeals.

So in any given county, you have anywhere between three and four different boards or commissions or bodies that have some level of decision-making power over ordinances, over project applications and approvals, over public hearings, over imposing or setting conditions. That gives a local community a lot of levers by which a proposal can get consideration, and also be derailed or rejected.

You even have, in one instance recently, a municipality that disagreed with the county government: The municipality really wanted a solar project, and the county did not. So there can be tension between the local jurisdictions. We’re seeing the same with data centers and other types of development as well — we’ve heard of proposals such as carbon capture and sequestration for wells or test wells, or demonstration projects that have gotten caught up in the same local decision-making matrix.

Where are we at with unifying siting policy in Indiana?

At this time there is no legislative proposal to reform the process for wind, solar, and battery storage developers in Indiana. In the current legislative session, there is what we’re calling an affordability bill, House Bill 1002, that deals with how utilities set rates and how they’re incentivized to address affordability and service restoration. That bill is very much at the center of the state energy debate, and it’s likely to pass.

The biggest feature of a sound siting and permitting policy is a clear, predictable process from the outset for all involved. So whether or not a permit application for a particular project gets reviewed at a local or a state level, or even a combination of both — there should be predictability in what is required of that applicant. What do they need to disclose? When do they need to disclose it? And what is the process for reviewing that? Is there a public hearing that occurs at a certain period of time? And then, when is a decision made within a reasonable timeframe after the application is filed?

I will also mention the appeals processes: What are the steps by which a decision can be appealed, and what are the criteria under which that appeal can occur? What parameters are there around an appeal process? That's what we advocate for.

In Indiana, a tremendous step in the right direction would be to ensure predictability in how this process is handled county to county. If there is greater consistency across those jurisdictions and a way for decisions to at least explain why a proposal is rejected, that would be a great step.

It sounds like the answer, on some level, is that we don’t yet know enough. Is that right?

For us, what we’re looking for is: Let’s come up with a process that seems like it could work in terms of knowing when a community can weigh in, what the different authorities are for who gets to say yes or no to a project, and under what conditions and on what timelines. That will be a huge step in the right direction.

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Spotlight

The Data Center Transmission Brawls Are Just Getting Started

What happens when one of energy’s oldest bottlenecks meets its newest demand driver?

Power line construction.
Heatmap Illustration/Getty Images

Often the biggest impediment to building renewable energy projects or data center infrastructure isn’t getting government approvals, it’s overcoming local opposition. When it comes to the transmission that connects energy to the grid, however, companies and politicians of all stripes are used to being most concerned about those at the top – the politicians and regulators at every level who can’t seem to get their acts together.

What will happen when the fiery fights on each end of the wire meet the broken, unplanned spaghetti monster of grid development our country struggles with today? Nothing great.

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Hotspots

Will Maine Veto the First State-Wide Data Center Ban?

Plus more of the week’s biggest development fights.

The United States.
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1. Franklin County, Maine – The fate of the first statewide data center ban hinges on whether a governor running for a Democratic Senate nomination is willing to veto over a single town’s project.

  • On Wednesday, the Maine legislature passed a total ban on new data center projects through the end of 2027, making it the first legislative body to send such a bill to a governor’s desk. Governor Janet Mills, who is running for Democrats’ nomination to the Senate, opposed the bill prior to the vote on the grounds that it would halt a single data center project in a small town. Between $10 million and $12 million has already been sunk into renovating the site of a former paper mill in Jay, population 4,600, into a future data center. Mills implored lawmakers to put an exemption into the bill for that site specifically, stating it would otherwise cost too many jobs.
  • It’s unclear whether Mills will sign or veto the bill. Her office has not said whether she would sign the bill without the Jay exemption and did not reply to a request for comment. Neither did the campaign for Graham Platner, an Iraq War veteran and political novice running competitively against Mills for the Senate nomination. Platner has said little about data centers so far on the campaign trail.
  • It’s safe to say that the course of Democratic policy may shift if Mills – seen as the more moderate candidate of the two running for this nomination – signs the first state-wide data center ban. Should she do so and embrace that tack, it will send a signal to other Democratic politicians and likely accelerate a further shift into supporting wide-scale moratoria.

2. Jerome County, Idaho – The county home to the now-defunct Lava Ridge wind farm just restricted solar energy, too.

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Q&A

Why Data Centers Need Battery Storage

A chat with Scott Blalock of Australian energy company Wärtsilä.

Scott Blalock.
Heatmap Illustration/Getty Images

This week’s conversation is with Scott Blalock of Australian energy company Wärtsilä. I spoke with Blalock this week amidst my reporting on transmission after getting an email asking whether I understood that data centers don’t really know how much battery storage they need. Upon hearing this, I realized I didn’t even really understand how data centers – still a novel phenomenon to me – were incorporating large-scale battery storage at all. How does that work when AI power demand can be so dynamic?

Blalock helped me realize that in some ways, it’s more of the same, and in others, it’s a whole new ballgame.

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