The U.S. House passed a ratepayer protection bill designed to limit how large data center loads shift costs onto residential electricity customers.

The U.S. House of Representatives on Wednesday passed the Ratepayer Protection Act in a 417-3 vote. Designed to prevent data centers and other large computational loads from shifting grid and power generation costs onto existing customers, the legislation requires states to “consider” adopting standards for electrical loads exceeding 100 MW—a transition already underway in most states. In a client note Thursday, ClearView Energy Partners described the House bill as “somewhat behind the regulatory curve,” noting it would “largely reinforce” that shift.

Despite its passage, the bill is unlikely to advance through the Senate before the midterm elections in November. ClearView noted that the chamber’s compressed pre-election schedule means passage may require unanimous consent, potentially allowing senators seeking stronger consumer protections to block the measure. Even if enacted, the bill would likely have limited immediate impact given the widespread adoption of large-load tariffs across states. Nevertheless, its passage signals a broad, bipartisan backlash against data center development and artificial intelligence.

Utility companies, meanwhile, view the infrastructure required to serve data centers—which can consume as much power as small cities—as a significant growth opportunity. Some industry voices argue that large loads can lower prices by spreading fixed costs and spurring grid investment. State regulators are increasingly codifying ratepayer protections through new rules, such as requiring prospective large-load customers to pay upfront for system impact studies, ramp up to full capacity within a set timeframe, and pay exit fees if they halt development or significantly reduce service. According to a large load tariff database maintained by the Smart Electric Power Alliance, only 13 states currently lack utility tariffs setting requirements for data centers and other large loads, with at least three of those states considering proposed rules as of July.

The Ratepayer Protection Act would direct state utility regulators and unregulated utilities to consider adopting large-load standards that ensure cost recovery for the “full, incremental” expenses of any generation, transmission, or distribution upgrades needed to serve these customers. It also mandates that large loads provide financial assurances prior to grid upgrades and guarantees cost recovery if a customer exits its power supply contract early. Following passage, regulators and unregulated utilities would have one year to begin evaluating whether new large-load tariffs or service requirements are necessary, with a two-year deadline to reach a final decision.

“The bill ensures large data centers pay for the infrastructure they require while giving states the flexibility to determine what works best for their communities,” Rep. Gabe Evans, R-Colo., the bill’s co-sponsor, said in a press release. Rep. Kathy Castor, D-Fla., served as the other primary co-sponsor. ClearView highlighted the significance of including power supply costs, noting that interconnection agreements typically cover only transmission and distribution infrastructure. “In addition to the significant incremental development costs, requiring data centers to [Bring Your Own New Capacity] could extend the construction process of data centers by years, as it typically takes far longer to construct a power plant than develop a data center,” the research firm stated.

The bill’s prospects in the Senate remain uncertain. Last month, Sen. Martin Heinrich, D-N.M. and ranking member of the Senate Energy and Natural Resources Committee, introduced the GRID Savings Act, which also aims to shield ratepayers from data center costs. That proposal would task the Federal Energy Regulatory Commission (FERC) with establishing rules for large-load interconnections, covering cost allocation, financial security requirements, and cost estimate disclosure. According to Politico, Heinrich has argued that the House version does not go far enough. Meanwhile, the Center for Data Innovation contends the legislation should apply uniformly to all large loads rather than targeting data centers specifically. “Congress should apply the standard uniformly to any customer at 100 MW or more, establishing a separate rate class for these large electricity users,” said Michelle Lopes Maldonado, the group’s associate director of AI policy, in a statement. “This preserves the cost-recovery principle while eliminating sectoral favoritism and ensuring residential users are not left paying the bill.”