Senator Mike Lee Proposes Data Center Power Reform

The bill mandates that data centers cover all grid expansion and electricity costs in Utah and beyond.

Updated on Oct. 23, 2026 in Data Centers

Isometric editorial illustration of a high-voltage steel power pylon in a desert, representing utility infrastructure for data centers. — Senator Mike Lee introduced the American Affordability and Jobs Act of 2026, which would require data centers to fully fund their own grid infrastructure expansion costs. AI Illustration. Upload story photo >

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Should data center developers be required to pay the full cost of local energy infrastructure upgrades?

Introduced on September 16, 2026, the Bipartisan American Affordability and Jobs Act of 2026 prevents data centers from shifting infrastructure costs to ratepayers. The 417-page bill requires firms to fully fund grid expansions and provide upfront financial guarantees.

Why it matters

The legislation responds to growing public frustration in Utah regarding the impact of energy-intensive data centers on local utility costs. It aims to protect families and businesses from shouldering the financial burden of massive grid improvements.

The legislation mandates that data centers cover 100% of grid expansion costs and provide upfront capital guarantees. This applies to massive infrastructure projects like the $17 billion Delta Gigasite currently under development in Millard County.

The players

Mike Lee

Mike Lee is a United States Senator who introduced the legislative package.

Creekstone Energy

Creekstone Energy is the development firm behind the $17 billion Delta Gigasite project in Millard County.

Shon Hiatt

Shon Hiatt is an expert who testified regarding data center impacts before the Workforce Services Interim Committee.

The details

Data centers would remain legally obligated to pay for infrastructure even if projects are cancelled or they cease operations early. Additionally, the bill authorizes states to mandate that these facilities construct private power plants or curtail electricity usage during peak demand.

September 16, 2026: The Bipartisan American Affordability and Jobs Act was introduced.
August 19, 2026: Shon Hiatt provided testimony to the Workforce Services Interim Committee.
2020-2025: Investor-owned utilities reported no power price effects linked to data center demand.

The Tech Race

This legislation marks a significant departure from established utility precedents by forcing tech giants to internalize the costs of their massive energy footprints. It effectively challenges the industry reliance on shared grid infrastructure as data centers scale to unprecedented levels.

By shifting the financial burden of grid expansion away from general ratepayers, the bill seeks to stabilize electricity bills for Utah residents. Local businesses and families may see more predictable utility costs as large-scale energy projects are forced to operate as self-funding entities.

The takeaway

The bill forces a major transition in how the tech industry integrates with public utilities. Stakeholders should monitor upcoming Senate committee votes to see if these strict financial requirements remain intact as the bill progresses.