Power for the People Act of 2026
- Sponsor
- Rep. Tonko, Paul [D-NY-20]
- Committees
- Energy and Commerce Committee (primary)
- Last action
- Apr 9, 2026
Bottom line
The bill aims to shift the financial burden and grid reliability risks associated with rapidly growing data center electricity demand from general ratepayers to data center owners and operators, while promoting clean energy and labor standards.
What it actually does
This bill mandates the Federal Energy Regulatory Commission (FERC) to establish data center-specific load queues that prioritize interconnection for data centers offsetting their electricity demand with new, clean energy resources and adhering to labor standards. It also directs FERC to allocate local transmission upgrade costs directly to interconnecting data centers and encourages states to create data center-specific rate classes to prevent other ratepayers from subsidizing data center energy costs. Additionally, it requires improved forecasting and transparency for data center load interconnection requests.
Proponents argue
Proponents argue that the rapid growth of data centers is disproportionately increasing electricity prices and straining grid reliability for ordinary households and businesses, who are currently subsidizing this development. They contend that data center owners should be held accountable for these costs and risks, and that the bill's provisions will ensure fair cost allocation, incentivize sustainable energy practices, and create good-paying jobs.
Opponents contend
Opponents might argue that these regulations could stifle innovation and economic growth in the data center industry, potentially driving development to other countries or less regulated states. They might also contend that mandating specific energy and labor requirements could increase operational costs for data centers, which could be passed on to consumers of digital services or make the U.S. less competitive in the global digital economy.
The bill is moderately technical but its structure and language are generally accessible, allowing an informed reader to understand its core provisions within the given time.
Section 2
Congressional Findings on Data Center Impacts
This section outlines Congress's findings that data centers are causing electricity prices to rise, straining grid reliability, and that ratepayers are subsidizing their development. It asserts that increased federal oversight is needed and that FERC has the authority to require load queues and rate classes to address these issues.
Supporters argue
Supporters argue this section clearly articulates the problem the bill seeks to solve, providing a strong legislative basis for federal intervention to protect ratepayers and grid stability.
Critics contend
Critics might argue that the 'Sense of Congress' overstates the negative impacts of data centers or unfairly assigns blame, potentially creating a biased framework for subsequent regulations.
Tradeoffs
The tension between fostering technological growth (data centers) and ensuring affordable, reliable electricity for all consumers.
Section 4
Mandatory Data Center Load Queue System
This section requires FERC to issue a rule mandating all covered interconnection entities (ISOs, RTOs, transmitting utilities) to create a data center-specific load queue system. This system must prioritize data centers that offset their electricity demand with new, low- or no-carbon supply resources, incorporate low- or no-carbon backup generation, and adhere to prevailing wage and apprenticeship labor standards during construction. It also allows for delaying or denying interconnection if it adversely affects grid reliability, resource adequacy, or electricity affordability for non-data center users.
Section 4(c)
Standards for Load Flexibility Agreements
This subsection directs FERC to establish minimum standards and guidelines for 'qualifying load flexibility agreements.' These agreements would allow covered interconnection entities to interrupt data center service, with interruptions occurring before other grid users and before emergency conditions, to protect grid reliability. The goal is to reduce costs for ratepayers by minimizing the need for new generation and transmission infrastructure.
Section 5
Allocation of Local Transmission Upgrade Costs
This section directs FERC to require public utilities to file tariff amendments. These amendments must allocate local transmission upgrade costs, which are solely necessitated by the data center's existence, directly to the interconnecting data center. Data centers would still pay transmission rates reflecting the embedded cost of the integrated grid, but not these specific local upgrade costs.
Section 6
State Consideration of Data Center Rate Classes
This section amends the Public Utility Regulatory Policies Act of 1978 (PURPA) to require states with data centers to consider establishing specific rate classes for them. These rate classes would ensure data center owners cover the full cost of generation, transmission, and distribution upgrades. It also specifies several requirements for states to consider, such as minimum demand charges, extended utility contract lengths, increased upfront interconnection study costs, permissible 'load ramp' periods, 'clean transition tariffs,' and the use of Contribution in Aid of Construction (CIAC).
Section 8
Improved Forecasting and Transparency for Data Center Loads
This section directs the Secretary of Energy to establish a program providing technical assistance to covered interconnection entities for forecasting long-term load projections, specifically for data center load interconnection requests. It also requires FERC to establish transparency and disclosure requirements for data center load interconnection requests (at both transmission and distribution levels) to reduce speculative requests and improve forecasting accuracy.
The definition of 'data center' specifies an energy demand greater than 50 megawatts, meaning smaller data centers are exempt from the bill's provisions.
Section 3(3)(C)
Why it matters:This is standard legislative practice for defining the scope of applicability, rather than an attempt to obscure.
Case for: Supporters would argue that focusing on large data centers targets the primary drivers of grid strain and cost increases, while avoiding undue regulatory burden on smaller facilities.
Case against: Critics might contend that excluding data centers below 50 MW could create a loophole, allowing multiple smaller facilities to collectively contribute to grid issues without being subject to the new regulations.
Estimated impact: Significantly narrows the scope of data centers directly affected by the bill's mandates.
The definition of 'organic load growth' explicitly excludes load growth attributable to data centers and facilities used to mine cryptocurrency.
Section 3(11)(B)
Why it matters:This is a definitional clarification crucial for how the load queue system prioritizes different types of demand, rather than an evasive tactic.
Case for: Proponents argue this ensures that essential community and economic growth (organic load) is prioritized over the discretionary and often speculative growth of data centers and crypto mining, protecting public interest.
Case against: Opponents might argue that this exclusion unfairly stigmatizes data centers and cryptocurrency mining, potentially hindering innovation and economic activity in these sectors by placing them at a disadvantage for grid access.
Estimated impact: Directly impacts how grid operators prioritize interconnection requests, potentially delaying data centers and crypto miners in favor of other types of load.
This subsection specifies that compliance with labor standards (prevailing wages and apprenticeships) can be achieved if a contractor or subcontractor is a signatory to a pre-hire collective bargaining agreement or if a project labor agreement is used for the construction of the data center and associated energy resources.
Section 4(e)
Why it matters:This is a technical clarification on how compliance with labor standards can be demonstrated, which is common in legislation involving labor provisions.
Case for: Supporters argue this provides clear, established pathways for data center developers to meet labor standards, leveraging existing collective bargaining frameworks and promoting efficient project execution.
Case against: Critics might argue that this provision implicitly favors unionized labor, potentially limiting competition among contractors and increasing costs for developers who prefer non-unionized workforces.
Estimated impact: Provides specific mechanisms for meeting labor requirements, potentially influencing contracting decisions for data center construction.
This subclause lists six specific requirements for states to consider including in data center rate classes: minimum demand charges, extended utility contract lengths, increased upfront interconnection study costs/deposits, permissible 'load ramp' periods, a 'clean transition tariff,' and the use of Contribution in Aid of Construction (CIAC).
Section 6(a)(22)(B)(ii)
Why it matters:While detailed, these are specific examples of mechanisms states could use, rather than being intentionally hidden. Their placement reflects the hierarchical structure of legislative text.
Case for: Proponents argue these specific tools provide states with a comprehensive toolkit to ensure data centers bear their full costs and integrate responsibly into the grid, preventing ratepayers from being burdened.
Case against: Opponents might argue that these detailed suggestions are overly prescriptive and could limit state flexibility in designing rate classes appropriate for their unique energy markets and economic conditions.
Estimated impact: Provides a detailed roadmap for states to implement cost-recovery mechanisms from data centers, potentially significantly altering the financial landscape for data center development.