(This paper is part of the series Data Centers and the Next Era of Energy Regulation. Find an overview and all the related resources on the series page here.)
Transparency and planning are the foundations for informed and effective regulatory decision-making amid the uncertainty of rapid large-load growth. This paper identifies four primary steps in optimizing transparency and planning, with strategies for implementing each step:
- Get collaborative. Decision-makers should ensure that any incentives such as tax breaks align with the public interest. Because data center impacts are wide-ranging, collaboration is also essential among different agencies and levels of government and among utilities.
- Gather information about what is coming. Collecting sufficient data to inform decisions is complicated by competitive interests in confidentiality. Decision-makers can use and expand existing tools, including data requests, investigations and studies, and reporting.
- Scrutinize data center demand in planning. Analysts can use contingencies, scenarios and sensitivities to help navigate uncertainty. Also, modeling data center load flexibility can open up options for balancing quick connections with reliability and affordability.
- Evaluate existing system and resource options. Robust planning is essential to understand the capabilities of the existing system and options to expand resources. Decision-makers should ensure that utilities consider a range of resources that can be deployed quickly and cheaply, including systemwide flexibility, systemwide energy efficiency, transmission innovations, and utility-scale renewables and storage.
