Wisconsin-based utility company We Energies has proposed a new electricity rate aimed at data center customers. The aim is to shield other ratepayers from the costs associated with the construction of power generation and electric infrastructure needed to support data centers.
According to reporting from the Milwaukee Journal Sentinel, the new rate could impact the $3.3 billion data center campus in Mount Pleasant currently being developed by Microsoft. In January, Microsoft paused construction on parts of the data center, citing technology changes.
According to the PSC filing, the new electricity rate would have nine billing determinants. One of which is an administrative change that includes a fixed cost of $213,118 per billing period plus the variable cost of $305 per megawatt of maximum customer demand per billing period.
The new charge would cover the full personnel and overhead costs dedicated to serving any new very large customer (VLC).
"Under this (rate) proposal, very large customers such as data centers will have access to reliable power to meet their needs. These large customers will directly pay for the power they consume, along with costs of the power generation plants and distribution facilities built to serve them," We Energies said in a statement.
Following the filing, the new rate proposal will go to the state Public Service Commission for consideration.
The process will take several months to complete and include public hearings prior to a decision being made.
In response, Microsoft has said it is working with We Energies to support new grid capacity which matches the amount its Mount Pleasant data center will use.
“Microsoft is committed to being a responsible neighbor in Wisconsin. As we continue to develop a $3.3 billion data center campus in Mount Pleasant, the draft tariffs submitted to the Public Service Commission will ensure we are protecting other ratepayers, paying our own way, and ensuring energy needs are met throughout the state," Bobby Hollis, Microsoft's vice president of energy, told the Journal Sentinel.
We Energies is the trade name of Wisconsin Electric Power Company and Wisconsin Gas LLC, two utility subsidiaries of WEC Energy Group. The utility serves more than 1.1 million electric customers in Wisconsin and Michigan’s Upper Peninsula and 1.1 million natural gas customers in Wisconsin.
