S.B. 282 Electrical Grid Amendments: transcript

Senate Transportation, Public Utilities, Energy, and Technology Committee, Feb 18, 2026

1. Chair Harper (presiding)39:05

   Welcome. Senator Blouin. We will now call Senate Bill two eighty two electrical grid amendments. That doesn't go up, huh? Okay.

2. Sen. Nate Blouin39:20

   Thank you, chair. Thank you. Committee, uh, SB 2 82. This is a good one. Uh, Utah is at the center of one of the biggest economic shifts of our time. Uh, we have massive data centers owned by trillion dollar tech companies, uh, coming to our state because we have affordable land, cheap electricity, and strong infrastructure. But that opportunity, uh, it comes with risk. These facilities use enormous amounts of electricity and water for cooling. Uh, they generate huge profits for tech companies and their billionaire share shareholders. But, uh, Utah families and small businesses are often ending up subsidizing the costs when utilities build new infrastructure to serve them. So, SB 2 82 says, enough is enough. Uh, Utah rate payers should not be left holding the bag here. This bill applies only to the largest energy users, loads over, uh, a hundred megawatts. And it requires those companies to put up financial security, uh, upfront before they start, uh, before they enter into the process. So that would include bonds, letters of credit, or other guarantees to cover the cost of infrastructure before they connect. Uh, if a company promises growth but never follows through, uh, Utah families and small businesses won't pay for infrastructure built for expansion that never ends up happening. Second, uh, serving these customers must have a net neutral or a positive impact, not just on corporate profits, uh, but on our communities, on our grid, uh, and on our environment. Companies must show that they won't raise electricity rates for everyone else, and that they must deliver reciprocal benefits, including, uh, grid support, infrastructure, investments, or, uh, environmental improvements. And third, uh, this bill requires transparency. Uh, data centers must report their electricity and water use annually so that communities and policy makers can see the true impacts of these facilities. So this bill is about fairness. Uh, right now, Utah places stricter citing rules, uh, or we are considering placing stricter citing rules on, uh, solar energy, particularly on projects on agricultural land, uh, than we are on, on major industrial facilities owned by some of the wealthiest corporations in the world. Uh, SB 2 82 doesn't treat these corporate users the same, but it does provide important guardrails and accountability to ensure they don't shift costs to families and our communities. Now, if a billion dollar corporations want to build here and profit from Utah's resources, they need to pay their fair share. They need to protect our grid, and they need to safeguard our communities. Utah families shouldn't be subsidizing corporate profits. Our communities should not bear the cost while billionaires reap the rewards. Uh, and this bill ensures that growth benefits everyone, not just the wealthiest corporations, but the actual people of Utah. That concludes your presentation. It does. Okay. Thank you to the committee for questions or discussion.

3. Chair Harper (presiding)42:25

   Senator Winterton?

4. Sen. Ronald M. Winterton42:30

   Yeah. As I read the bill, I like the concept in this, but are you saying that you want them to project up front what the, these costs are gonna be and the use of, of, uh, the water and that, and then after it's built, they come back and and report annually on those things? Is that how this is working? And then the other thing was, is that like the financial bonding and that?

5. Sen. Nate Blouin42:56

   Yeah. So as far as the, the reporting, uh, I believe it would, I'm actually not sure on the first piece about, I, I forget if we put in that they would need to forecast, it's mainly about reporting what they're actually using, uh, so that once they are, uh, up on the grid, you know, using water resources and that sort of thing that they're being required to disclose to communities, to regulators, uh, both the state and at local levels that, uh, here are the, uh, here are the resources they're using because we, we, we currently don't really have a lot of insight. There's a lot of, uh, conflicts, not conflict, uh, non-disclosures, uh, and that sort of thing being signed that make it very difficult to get some of this data. And then as to the, the financial surety part, I think that's, that's critical because we are seeing, uh, companies, you know, put projects into interconnection queues around the country, and they're, they're speculative, uh, they're not actually getting built, but they're moving forward in the process. And so the utilities are planning for these investments, like they're gonna happen, and then, uh, they're actually putting steel on the ground and, and that, uh, is not translating into actual development of data centers. And so then the cost gets settled over to, uh, rate payers, not the folks who initially forecasted the growth. So that's a, that's a really critical part here.

6. Sen. Ronald M. Winterton44:10

   Okay. I, I was, I just was answering, then I got thinking, uh, a lot of what you're, you're asking for is a great idea. Is there places to insert the local, because again, Condit conditional use permit or something from the local entities, hopefully they're checking the boxes, is to find out that they do have water resources available, or like you say, Piute in the sky type of a thing that we're speculating to get through this process. Is there local eyes on this end?

7. Sen. Nate Blouin44:45

   My understanding of how kind of things are going forward, or we're seeing these really big companies with lots of resources come in and, and promise all sorts of riches to local communities and are not delivering. And so we are seeing them, you know, these local communities kind of sign away their rights to a lot of these things and contracts and non-disclosure agreements. And so the whole purpose here is to make sure that, uh, we do have those protections for our local communities. I'd be happy to insert stronger language. I think making more requirements at the local level, that that's certainly, uh, a place where I'd be happy to, to make this bill even stronger.

8. Sen. Ronald M. Winterton45:17

   I think. Um, yeah, I think that's a, that's a good point.

9. Sen. Nate Blouin45:20

   And, and we certainly, the, the whole point is about making sure that local communities have benefits coming and that they have, uh, real insights and real, uh, a real stake in, in this process as these really big developments move in and, uh, you know, do provide some jobs and, and tax revenues and that sort of thing. But, um, we're seeing many instances where I think there's, there's a lot more that could be done.

10. Sen. Ronald M. Winterton45:42

    You're right. And, and you know, as we look around that we've got a lot of energy resources and we talk about the geothermal, and then when we're talking nuclear, well, those local communities have a lot of say in, do we want this in our backyard? We welcome it, or whatever. Um, I just think it probably be good idea that we could insert, you know, input or, or at least, you know, they should have eyes on it before. As state leaders, we force this on some community.

11. Sen. Nate Blouin46:14

    Yeah. And this, this is completely not about forcing. This is, this is the opposite of trying to force on a community. This is trying to be, uh, to make sure that local communities are not signing away their rights, uh, are not, you know, entering into agreements with, uh, these, these companies without the, the right sort of information available to them. That's, that's exactly what's accomplished here. Thank you.

12. Sen. Ipson46:34

    Thank you. Senator Ipson. Thank you, Mr. Chair. So you're saying that once one of these operations is in operation that you require 'em to report, don't, wouldn't the utility already know what you're using? Why would they need to report it?

13. Sen. Nate Blouin46:52

    The utility probably would, uh, I think, you know, Rocky Mountain Power, other utilities would, would know those sorts of things. But they don't necessarily get disclosed to, to the public, uh, to folks who are concerned about what's happening in our communities. You know, there's, there are, uh, there's proprietary information that certainly doesn't get made public. I think there, there may other be other bills that do, uh, address some of the transparency issues here. I they are not as strong as I would like to see them though, in my understanding of those other bills. So this is, this is really about public transparency and ensuring that the people of Utah, uh, know how much water is being used, how much energy is being used, what the, what the costs are. Uh, as far as, you know, our, our increasing energy demand and increasing energy costs, making sure that we have, uh, oversight and insight into all of that.

14. Sen. Ipson47:37

    I'm not sure I understand why, if, if, if everything's put in place and they're paying their bill, why we care A, a question? That's A Question. I think,

15. Sen. Nate Blouin47:50

    I think we, we should care about, uh, ensuring that these facilities are, are being good, uh, stewards and good neighbors. I think these are facilities that promise a lot, that promise a lot of jobs, a lot of tax revenue. Uh, and, and, you know, we are seeing people make absolutely gigantic amounts of profit off of this. Uh, and yet we see our energy bills here in Utah. I think they went up 15% or so last year. Um, this is saying that if, if we can attribute that, and this would be up to the Public Service Commission, if we can attribute that to these sorts of developments, uh, that they will meet, need to cover those costs, those will need to come out of the, uh, pockets of, of shareholders, uh, and, and not of rate payers. I think that's, that's really important. This is about addressing those costs and, uh, making sure that, you know, these facilities are really paying back into the communities. They're coming into. You know, we're not asking them to, uh, to, to give up all their money or anything. But it's certainly just saying, Hey, we want to make sure there are positive benefits in terms of tax revenues, in terms of communal benefits, you know, uh, new schools, new, uh, new gyms, whatever libraries, uh, making sure that there's good environmental oversight here. That the, uh, resources that they're using are, are clean and, and not adding additional, uh, pollution to the environment. So that's, there's a, there's a big bucket of kind of the positive benefits I've, I've, uh, put into the bill, but I think that's, that's what this is about.

16. Chair Harper (presiding)49:14

    Senator Rebe.

17. Sen. Kathleen A. Riebe49:17

    Thank you, Mr. Chair. Um, on line 16, it talks about the changes to the commission, and that's just in the short title. And then when you go down to line 2 54, um, it says, modifies commu commission review requirements. Then we go down to 2 54. Is, um, would this language, when you say modifies the commission, would this language on 2 54 create what Senator Winterton was asking for, for a, a more local control? Or is there, um, something else we can put in there so that there's more local control? Yeah, so this is talking about the Public Service Commission. Yep. Um, there, I'm trying to think, let me see where we have language about out other levels of government in here. It's not that long of a bill, it's just spread out To the Senator win's point. I, I think that it is important that we have local control and, um, I know that the Public Service Commission has certain guidelines, but would this empower that commission to go back to the local entities that represent them and have more impact? That's kind of my question.

18. Sen. Nate Blouin50:36

    Yeah, it would certainly give those local entities input. You know, they can come to the Public Service Commission, they can weigh in on all this at the, at the Public Service Commission. This is, so it has a, in here, a large load resource use report. This is on line 98. Mm-hmm. Uh, annual report submitted by a large load Customer to the DNR and to the municipality or county in which the large load use customers facilities are located. And then it talks about what is, what is required to be in that report. So it does require that report going to, uh, localities in, in those areas. And then, yeah, they're certainly, you know, the Public Service Commission is a venue where they can come in, uh, weigh in, you know, talk about, uh, these facilities express their support or opposition. And then the cus the customer service, the Public Service Commission, uh, gets to make decisions about what, um, how these, uh, policies in here, you know, interpreted into what it actually means for these, these things to get built.

19. Sen. Kathleen A. Riebe51:33

    Thank you. Thank you.

20. Chair Harper (presiding)51:35

    Seeing no more questions, we'll go to the public. Is there anyone in the public who wishes to address this bill? We have one. Come on up. Any online? And we have one online. Okay.

21. John Cox, Rocky Mountain Power51:51

    Thank you, Mr. Chair. Uh, my name is John Cox. I'm, uh, representing Rocky Mountain Power, uh, today, uh, we have concerns with the bill, uh, would encourage you to hold the bill, uh, until those concerns could be resolved. Uh, chief Chief among the, well, first of all, just to back up, uh, some of the things that are noteworthy in this bill that have been explained in the presentation about not subsidizing, uh, these types of projects by other, uh, by other rate payers, by other customers of the utility, uh, it's important to note that in the bill that you all passed last year, Senate Bill 1 32, which created this section of code, uh, expressively prohibits that. And if you look in the underlying code as it's written today, uh, and I can point out specific lines in this bill that are not created, but are there, uh, existing today, it prevents that type of cost shift, uh, from occurring specifically. Uh, we were just talking about the commission section or the commission approval process. Uh, we were mentioning lines 2 54. If you go up just a couple lines before that, it mentions that in order for the commission to approve one of these contracts, the large load customer must bear all just and reasonable costs attributed to this, uh, specific request. And that existing rate payers do not bear costs, uh, attributed to this, uh, type of project. Uh, so the, the provisions here, offering that type of protection, I just would like to note they're in statute today. Uh, that was the bill that you all passed last year. Similarly, uh, the, the note, uh, on, uh, providing financial security, that's also in current statute today. If you look at line 180 1, uh, in the bill, it's not new language that's added, uh, it's existing language from Senate Bill 1 32. It requires the large load customer to maintain financial security sufficient to cover this customer's obligation. They have to prove that as well. So anyhow, you're, you're repeating some of that, uh, some of these protections exist there today. Why do I have concerns with it if you're just repeating things? The thing that is new and hasn't been talked about much, uh, here in this, this presentation today is environmental benefits, uh, and environmental impacts. And that is new. And that is something that today the Public Service Commission does not address. The Public Service Commission is an economic regulator. It is not an environmental regulator. Uh, we have an environmental regulator here in the state of Utah. It's the Department of Environmental Quality. Uh, in this particular case, you've added new sections of code. Then in order for these projects to be built, certain environmental benefits, uh, must be demonstrated. Uh, and it's defined, uh, line 1 53, including operation as a non emitting facility, emissions reduction, uh, compliance with environmental standards that exceed regulatory requirements. Um, so that is the reason for the concerns today. Again, the Public Service Commission is not an eco, uh, excuse me, an environmental regulator. It is an economic regulator. If the state of Utah would like, uh, certain environmental attributes in these projects, they should do so through the Department of Environmental Quality. Um, so with that, I'm happy to respond to any questions

22. Chair Harper (presiding)54:40

    Question. Senator Kwan?

23. Sen. Karen Kwan54:42

    Thank you, Mr. Chair. So what I'm hearing is that it, there's not opposition to the environmental benefit pieces in here, it's just where it's placed that it, is this, what I'm hearing, that it should go to environmental quality Department of, um, DEQ rather than to the public service?

24. John Cox, Rocky Mountain Power55:05

    Yeah. If the state of Utah would like to require certain environmental attributes, they, they can do that. You could do it just for this type of customer. You could do it for all customers. Some states have, uh, re uh, renewable portfolio standards or clean energy standards where you say a certain percent of your portfolio has to be clean. The state of Utah has that prerogative as a public utility in the state. We will do what the state, uh, directs us to do. Know that that can come with costs though. And so long as you're comfortable with that, that is the prerogative of the state of Utah to date in the state's energy policy. That is not the direction that we've been given.

25. Sen. Karen Kwan55:39

    Thank you. And Mr. Chair, go ahead. Um, I, I'd really like the sponsor to address that and to, um, you know, to address whether or not he considered, uh, putting it in a different department. Um, and, and I don't know if this is a, an appropriate time to have him do it since it's he's,

26. Chair Harper (presiding)55:55

    He's at the witness stand. Go ahead and ask him. Okay.

27. Sen. Karen Kwan55:58

    So that's my question is, um, uh, whether or not, uh, you considered putting those pieces into DEQ and and why not? If you

28. Sen. Nate Blouin56:08

    Yeah. No, I, I don't think that's the right place. I think the Public Service Commission is the place to regulate large utilities. That is the oversight they have. Uh, whether it's we can, we certainly have the prerogative to change, uh, their, their, uh, portfolio. So I think that this is, that that would be the right place to do it. Uh, pulling in other agencies, I don't think would, uh, would streamline the process. I think that would just create additional red tape and, uh, and, and bog folks down even further. I think the Public Service Commission does a great job. Um, I, I've met with them. We've, we've spoken in front of them. They've been here speaking in front of these committees and, uh, I think they, they are the ones that are suited to make decisions on these sorts of projects.

29. Chair Harper (presiding)56:49

    Okay. Let me go online. We have Katie Beker. Turn on your microphone and your camera. There we go.

30. Katie Balakir, Healthy Environment Alliance of Utah56:57

    Thank you so much. Um, my name is Katie Beker and I represent the Healthy Environment Alliance of Utah. And thank you, Mr. Chair, for allowing public comment online. I was hoping to be there in person, but Mother Nature had other plans with the snow. Um, but I'm here to speak in support of SB 2 82. Really appreciate Senator Blouin for sponsoring the bill and also allowing for this really important conversation about how we balance data center growth with our limited resources and also prioritizing energy, affordability and reliability here in the state. Um, the Lawrence Berkeley National Laboratory, in partnership with the US Department of Energy predicts that data center energy demands are going to substantially grow in the coming years. Um, as of 23, they accounted for about 4.4% of total electricity consumption in the us And by 2028, we're expecting that that number will grow to 6.7 to 12%, um, which is pretty substantial growth. And we've been hearing from a great deal of community members, especially those in rural communities who have questions about what impact that will have on our limited water resources, um, and also on their energy costs. And of course, all of this data center growth is happening in the context of increasing energy costs in Utah. As the sponsor mentioned. Um, you know, we've seen a number of adjustments through the years in 2024. I'm sure many of you remember the initial rate increase proposal by Rocky Mountain Power to increase rates by as much as 30%. Um, luckily the Public Service Commission only approved a 4.7% increase, but just last November, um, Rocky Mountain Power again applied for an increase in utility rate of 4.5% this time to fund its wildfire liability insurance fund. And so we see that energy costs continue to rise and there are more proposals on the table. Um, I think that senate Bill 2 82 takes some really important steps to ensure that any new large load contracts have at least a net neutral, not even a a net benefit, but at least a net neutral impact on our energy, reliability, cost, and the environment. Um, which feels like a really fair ask. So by requiring the public service to commission to take some of these factors into account, um, when approving those contracts, it really ensures that individual rate payers are the priority. Um, furthermore, by requiring these large load customers to submit reports, um, on their actual energy consumption and water consumption, our state regulators can get a clearer understanding of what that impact is and how to mitigate that impact. And I think a really important part of this bill is also sharing that information with local governments, um, when that often isn't available to them in the status quo. So thank you again for the opportunity to comment and I hope that the committee can support Senate Bill 2 82.

31. Chair Harper (presiding)59:43

    Thank you very much. Seeing no one else, we will close public comment, bring it back to the committee for questions or action represe. Senator Riebe.

32. Sen. Kathleen A. Riebe59:56

    Thank you, Mr. Chair. Uh, I would like to favorably recommend Senate Bill 2 82 electrical grid amendments out with a favorable recommendation. I think this is something on a lot of people's minds lately about how we're gonna deal with our large load of energy and then also some of our water issues, which they mentioned just a lot happening with energy. So I think this is a, um, great bill for this time. Thank you.

33. Chair Harper (presiding)1:00:18

    Thank you. Discussion to the motion. Senator Kwan.

34. Sen. Karen Kwan1:00:21

    Thank you, Mr. Chair. Um, I've gotten so many emails and phone calls and, um, just people in my district talking about the increases in, um, prices and energy prices, and actually a lot of 'em have talked about data centers raising those prices. And I've said, but we've, we passed a bill that is supposed to take care of that. It's just, it's still rising. And I think Utah saw, um, one of the highest jumps last year, um, in, in energy prices. And I, uh, think a, uh, um, clarifying or, or, um, adding more language to beef up the bill is going to help with that. And so I wanted to say that I support this motion.

35. Chair Harper (presiding)1:01:07

    Thank you very much. Further discussion from the committee. Seeing none, Senator Blouin for summation.

36. Sen. Nate Blouin1:01:15

    Thank you. Yeah, I think what we heard from Rocky Mountain Power was a little bit disingenuous because what this is doing is actually saying that when we are forecasting load, uh, that we need to have as surety upfront so that we aren't seeing speculation. So what, uh, what the representative from Rocky Mountain Power was talking about was existing contracts, uh, and, and, uh, bringing new projects on at that point. But this is saying we are not going to have speculation happening. And, and I think that's where we, uh, where there's kind of a, uh, a bit of a divide as far as the costs that are being incurred by these, uh, the new infrastructure to support these facilities. So that's what we're trying to get ahead of. I think that's critical is that we get, uh, ahead of this issue because we're gonna see more speculation, more, uh, growth in this area. And regardless of, of the language that is preexisting, there are, uh, problems that we are seeing already with costs increasing here in Utah. So, uh, I think this is, this is an important bill to, uh, to set us on the right track. It is, it's certainly a balanced bill just talking about neutrality as was mentioned. It, I, I think I would love to have seen it go even further. But, um, we are just talking about, uh, being good partners and, and making sure that when a, when a big, uh, energy user comes in, that they are, uh, providing a really good partnership for our community and, uh, providing benefits back in, or at the very least, just not taking too much out. And I don't think that's too much to ask for.

37. Chair Harper (presiding)1:02:39

    Thank you. Senator Reed. Be for summation. Okay. All in favor of, of, uh, passing out favorably Senate Bill 2 82 to the floor. Say aye. Aye. All opposed, say nay. No. All rule that fails. Three to two with Quan, Senator Vickers, Quan and Rebe. I Ipson Harper and Winterton Noll. Okay. Uh, representative Pucci is asked to move her bill to another agenda as she's in another meeting, so I will accept a motion to adjourn from Senator Rebe. All in favor say aye. Aye. Aye. We are adjourned. Thank you.