The Pennsylvania House of Representatives has passed a bill seeking to shield ratepayers from rising utility costs related to data center growth in the state.

The bill, which was introduced in October by Rep. Robert Matzie, a Democrat representing Beaver, would provide the Pennsylvania Public Utility Commission (PUC) with the ability to establish rules and guidelines for the development of data centers. It would also give the PUC the ability to evaluate whether data center contracts impact the PJM grid and ratepayers.

“No one’s electric bill should ever go up because a data center has located in Pennsylvania,” Matzie said in a statement. “But we need to plan ahead to make sure that doesn’t happen.”

The bill passed through the House on a party-line vote, with Democrats in favor and all but a few Republicans opposing it. Following this, it now moves to the Senate, where the Republicans hold a majority.

Data center industry groups reacted to the news with concern, arguing that the measure "creates significant uncertainty for Pennsylvania's growing data center market, endangers future growth by singling out data centers for unequal rate treatment and introduces other problematic conditions that will impair data center operational viability in the Commonwealth," Dan Diorio, vice president of state policy for the Data Center Coalition, said in a statement.

Under the proposal, the new rate would apply to facilities with a capacity of 25MW or more and prohibit public utilities from shifting the costs of new generation and transmission infrastructure onto ratepayers.

In addition, the bill would require utilities to ensure that at least 25 percent of the electricity it supplies under contract is generated from renewable energy sources. During the hearing, several stakeholders voiced concerns that such a provision would challenge energy affordability.

The bill would also mandate data centers to pay out based on peak demand for a proposed fund that would enhance the Low-Income Home Energy Assistance Program. The federally funded program provides financial support to low-income households for their energy bills. Under the bill, data centers that use 100MW or more of energy would have to pay $500,000 per year into the program.

Pennsylvania is the latest state to see legislation aimed at protecting ratepayers advanced through its legislature.

Ohio was one of the first states to pass legislation to this effect, with the Public Utilities Commission of Ohio (PUCO) approving a new rate class in July. It requires new data center customers in Ohio to pay for a portion of their energy requests, even if they use less, to cover the cost of the infrastructure required to bring electricity to those facilities.

Following this, in September, Virginia’s main utility Dominion Energy proposed a new rate class for data centers, applying to utility customers who consume more than 25MW of energy and have a monthly load factor of more than 75 percent.

In January, Wisconsin joined the party, with the Wisconsin State Assembly passing a bill that would set out several protections for ratepayers.

In February, California saw a new bill introduced in the Senate that would require the Public Utilities Commission to establish a special rate structure for large-scale energy users, with a capacity of at least 75MW.