Kolbeck Criticizes Data Center Memo as Opinionated
A South Dakota lawmaker faulted a 17-page Legislative Research Council memo on hyperscale data centers, while colleagues defended it as neutral.
Updated on Nov. 13, 2026 in Data Centers
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Sen. Steve Kolbeck, an Xcel Energy executive and former Public Utilities Commission member, cast the lone no vote against accepting the Legislative Research Council's 17-page memorandum "Hyperscale Data Centers" at a Tuesday Executive Board meeting in Pierre. He called the document opinionated, while other lawmakers defended it as neutral and within its assignment.
Why it matters
The dispute centers on how South Dakota weighs data center growth against electricity and water concerns, a debate that already produced Senate Bill 135 earlier this year. Kolbeck said the Legislature had addressed electricity cost worries through that law.
The memo's 17 pages cite Lawrence Berkeley National Laboratory research finding infrastructure upgrades were the primary drivers of recent electrical rate increases, while Senate Bill 135 sets a 10-megawatt peak-use threshold for data centers to cover their power costs. Whether the memo's sourcing satisfies its critics remains unresolved.
The players
Steve Kolbeck
Kolbeck is a South Dakota state senator who works as an executive for Xcel Energy and previously served on the South Dakota Public Utilities Commission.
The details
Kolbeck's objection centered on the memo's framing, which summarized documented effects of hyperscale data centers on water and electricity in other states. Hale did not interview stakeholders, and the board had assigned the memo in April.
Timeline
April 2026: Executive Board assigns the data center memorandum.
Earlier in 2026: Senate Bill 135 is signed into law.
Tuesday, November 10, 2026 (approximate): Executive Board meets in Pierre and Kolbeck criticizes the memo.
Roadmap
South Dakota lawmakers passed Senate Bill 135 to make large data centers pay for the power capacity they require, and the Legislative Research Council memo examines whether further oversight is needed. The clash shows how state legislatures are weighing data center growth against ratepayer and resource concerns nationwide.
Under Senate Bill 135, the cost of power needed by very large data centers is assigned to those facilities rather than spread across all ratepayers. Residents may see the effect in future utility rate decisions, though the memo's findings do not change current rates.
The takeaway
Electricity cost allocation for data centers is becoming a state-level policy question, and lawmakers disagree on how neutral analysis should be presented. Readers following utility bills should watch how South Dakota applies the 10-megawatt threshold.
Further reading
For broader context on how these facilities are reshaping power demand, see Data Centers coverage.
Source note: This article includes information reported by The Mitchell Republic.
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