3.21.24 Legislative committee approves data center study bill

Legislative committee approves data center study bill
March 21, 2024 6:16 pm • Last Updated: March 24, 2024 10:21 am
By Daniel Drainville Day Staff Writer
d.drainville@theday.com
A bill passed Thursday by the state legislature’s Energy and
Technology Committee would require the potential impact of NE
Edge’s proposed data center at Millstone Power Station to be
studied by ISO New England, the grid manager for five states in
New England.
The proposed legislation, introduced by Sen. Norm Needleman, D-
Essex, would apply not only to NE Edge’s proposed data center in
Waterford, but to any data center proposed in the state that would
bypass the electrical grid.
Committee members voted 12-3 in favor of the bill, sending it to
the Senate for further consideration.
If the bill were passed, any data center that would be placed
“behind-the-meter,” meaning it would draw power directly from an
energy-producing source such as a power plant, wind farm or solar
park, would have to submit to an “impact study” from ISO New
England and the local utility company where the data center would
reside, Needleman said.
“If the backup is going to come from the grid, (we have) to make
sure that we have adequate power to do that,” he said. “We want to
make sure if we’re taking 300 megawatts, whatever wattage we’re
taking off a power plant and then backing it up with the rest of the
grid, it’s sort of like an additive amount of potential loss of
electricity.”
A state law enacted in 2021 created incentives for data centers to be
built in Connecticut, and enabled the state Department of Economic
and Community Development to sign long-term tax incentive
agreements with developers that pledge to invest millions of dollars

in the state.
As a result, several towns in the state, including Waterford, began
hosting discussions with data center developers. NE Edge last year
signed a host fee agreement with the town in which it promised to
pay a fee of $231 million over 30 years instead of property taxes.
Per the agreement, NE Edge would build two two-story data center
buildings on the Millstone property, enabling it to buy power
directly from Millstone owner Dominion Energy Nuclear
Connecticut, reducing the cost of power consumed by the data
centers.
The NE Edge project is in limbo after a January decision by the
state Siting Council to deny Dominion a boundary change it would
need to proceed with the project.
Needleman said at the time the incentive bill was proposed,
legislators had not fully considered the impact of data centers.
Rep. Holly Cheeseman, R-East Lyme, who supported the 2021 law,
now wants data centers’ potential impact on energy consumption to
be studied. She voted with the majority Thursday.
“I have real concerns both about the current proposal in my neck of
the woods,” she said, referring to NE Edge, “but also the
unanticipated consequences of adding yet another huge source of
demand in our grid.”
Rep. Paul Ackert, R-Coventry, said he will continue to vote against
the bill, which he believes is contrary to the one that enticed data
centers to build in the state.
“We look forward to looking to entice companies to come here and
give them a nice little financial credit, then we’re like whoa, whoa,
whoa, wait a minute. Timeout. Maybe don’t put those investment
dollars here,” he said.
d.drainville@theday.com