Power for the People Act of 2026
- Sponsor
- Sen. Van Hollen, Chris [D-MD]
- Committees
- Energy and Natural Resources Committee (primary)
- Last action
- Jan 15, 2026
Bottom line
The bill aims to shift the financial burden of data center energy demand and grid upgrades from general ratepayers to data center owners and operators, while also promoting labor standards and low-carbon energy solutions.
What it actually does
This bill mandates the Federal Energy Regulatory Commission (FERC) to require grid operators to establish data center-specific load queues that prioritize interconnection for data centers offsetting their energy demand and adhering to labor standards. It also directs FERC to allocate local transmission upgrade costs directly to interconnecting data centers and amends the Public Utility Regulatory Policies Act of 1978 (PURPA) to encourage states to create data center-specific rate classes. Additionally, it establishes programs for technical assistance and transparency in load forecasting.
Proponents argue
Supporters argue that data centers are rapidly increasing electricity consumption, causing rising energy bills for households and businesses, and straining grid reliability. They contend that data center owners should be held accountable for these increased costs and infrastructure investments, preventing ratepayers from subsidizing their development. The bill's provisions for load queues, cost allocation, and specific rate classes are seen as essential to ensure fairness, grid stability, and to incentivize sustainable practices and good-paying jobs.
Opponents contend
Critics might argue that these measures could stifle data center development and investment in the United States, potentially driving these businesses to other countries with less stringent regulations. They might also contend that imposing specific rate classes and upfront costs could increase operational expenses for data centers, which could then be passed on to consumers of digital services. Furthermore, some might argue that the labor standards could increase construction costs and limit flexibility for data center developers.
The bill is moderately complex due to its technical language and amendments to existing energy law, requiring careful reading to understand its full implications.
Section 2
Congressional Findings and Policy Rationale
This section outlines Congress's view that current energy policies allow households and businesses to subsidize data center development, leading to rising electricity prices and grid strain. It asserts that data center owners should be accountable for these costs and that federal oversight is needed to ensure reliability and affordability. It also suggests solutions like data center load queues and specific rate classes.
Supporters argue
Supporters argue this section accurately identifies a critical problem in the energy market where rapid data center growth is externalizing costs onto ordinary consumers and threatening grid stability, justifying the need for legislative action.
Critics contend
Opponents might argue that the "Sense of Congress" overstates the negative impacts of data centers or unfairly singles them out, potentially creating a hostile regulatory environment for a vital industry.
Tradeoffs
The tension between fostering economic growth through data center development and ensuring affordable, reliable electricity for all consumers.
Section 4
Establishment of Data Center Load Queue System
This section mandates FERC to require grid operators (ISOs, RTOs, transmitting utilities) to create a specific load queue system for data centers. This system must prioritize data centers that offset their electricity demand through new, low- or no-carbon supply resources, incorporate low- or no-carbon backup generation, and adhere to prevailing wage and registered apprenticeship requirements for construction, as well as labor peace agreements for operation and maintenance. 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 5
Direct 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 attributable to the existence of an interconnecting data center, directly to that data center. Data centers will 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-Specific Rate Classes
This section amends PURPA to add a new standard requiring states with data centers to consider establishing data center-specific rate classes. These rate classes would ensure data centers cover the full cost of generation, transmission, and distribution upgrades. Specific requirements for consideration include minimum demand charges, extended utility contract lengths, increased upfront interconnection study costs/deposits, permissible "load ramp" periods, "clean transition tariffs," and the use of "contribution in aid of construction" (CIAC) for upfront utility investment. States are given 1 year to commence consideration and 2 years to complete it.
Section 7
Grants and Technical Assistance for State Rate Class Creation
This section directs the Secretary of Energy to establish a program within 180 days to provide grants and technical assistance to state regulatory authorities and nonregulated electric utilities. The purpose is to help them create appropriate rate classes to ensure that costs related to data center energy demands (generation, transmission, distribution upgrades) are not subsidized by non-data center customers.
Section 8
Improved Load and Interconnection Forecasting and Transparency
This section establishes two programs: (1) The Secretary of Energy must create a program within 180 days to provide technical assistance to covered interconnection entities for improving long-term load projections, especially for data center load interconnection requests. (2) FERC must establish transparency and disclosure requirements for data center load interconnection requests (at both transmission and distribution levels) within 180 days. These requirements aim to reduce speculative requests and improve accurate forecasting.
Defines "data center" as facilities with energy demand > 50 MW and includes a clause allowing FERC to add "other criteria" and "anticircumvention provisions."
Section 3(3)
Why it matters:Standard legislative practice to include definitions and grants of regulatory authority, but the anticircumvention clause is a powerful tool that might not be immediately obvious.
Case for: Proponents would argue this is necessary to prevent developers from circumventing the intent of the law by splitting large projects or structuring them to fall just outside the initial definition, ensuring the bill's effectiveness.
Case against: Opponents might argue this grants FERC overly broad and potentially arbitrary power to define and regulate facilities, creating regulatory uncertainty for businesses.
Estimated impact: Could significantly expand the scope of facilities subject to the bill's regulations, impacting a broader range of energy consumers and developers.
Specifies that using a project labor agreement (PLA) for construction of a data center and its energy supply resources automatically satisfies the bill's prevailing wage and registered apprenticeship requirements.
Section 4(e)
Why it matters:This is a common legislative technique to streamline compliance for entities that already engage in certain labor practices, rather than an attempt to hide it.
Case for: Proponents argue PLAs ensure high labor standards, efficient project management, and a skilled workforce, making this a practical and effective compliance mechanism.
Case against: Opponents of PLAs in general might view this as favoring unionized labor and potentially increasing costs or limiting contractor choice, even if it's presented as a compliance option.
Estimated impact: Could encourage the use of PLAs in data center and associated energy infrastructure construction, influencing labor practices in the sector.
Explicitly excludes load growth attributable to "facilities used to mine cryptocurrency" from the definition of "organic load growth."
Section 3(11)(B)
Why it matters:This is a specific policy choice to differentiate cryptocurrency mining from other economic activities, potentially to subject it to stricter energy demand scrutiny, rather than an attempt to hide it.
Case for: Proponents argue that cryptocurrency mining is an energy-intensive activity with unique characteristics that should not be treated as essential or "organic" load growth, justifying its separate treatment to protect grid reliability and affordability.
Case against: Opponents might argue that this unfairly targets a specific industry, potentially hindering innovation and economic activity in the blockchain sector.
Estimated impact: Ensures that cryptocurrency mining facilities are subject to the full rigor of the data center load queue and rate class requirements, without any special consideration for "organic load growth."