On Tuesday, the Pennsylvania House Energy and Consumer Protection committees convened a joint hearing to address the pressing issue of rising energy costs and explore potential solutions to make electricity more affordable for consumers.
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fox43.comThe hearing featured testimony from representatives of PJM Interconnection, regulators, and consumer advocates, with a significant focus on the growing demand from energy-intensive data centers.Pennsylvania Consumer Advocate Darryl Lawrence highlighted that data centers accounted for 40% of PJM's capacity auction in December, contributing to increased costs and necessitating infrastructure upgrades funded by consumers.
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fox43.comLawrence urged lawmakers to ensure that new data centers bear the costs associated with their energy consumption, stating, "I strongly recommend that this body vote in favor of legislation to ensure that any new data centers in Pennsylvania must pay for any and all costs that they are causing that would not have been needed, but for the presence of a data center." This sentiment reflects concerns that data centers should not shift their substantial energy costs onto everyday ratepayers.
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fox43.comState Rep.Tom Mehaffie (R-Dauphin) expressed a cautious approach, warning that imposing excessive costs on data centers could deter investment in Pennsylvania.He emphasized the importance of attracting data centers to the state, noting that competition for these facilities is fierce among all 50 states."If they're guaranteed and they're going to pay their own way, and they don't get that, we're just chasing them to another state," Mehaffie said.
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fox43.comThe discussion also touched on the broader implications of rising energy costs.State Rep.Pat Gallagher (D-Philadelphia) reported a significant increase in energy bills in his district, with his own bill reflecting a 20% rise.Gallagher attributed part of this increase to the growing demand from data centers, stating, "The data centers are causing some spikes in usage." He called for better management and regulation of these facilities to prevent further financial strain on ratepayers.
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fox43.comThe hearing coincided with a recent meeting where Governor Josh Shapiro joined other governors in the PJM region to sign a statement of principles aimed at supporting reforms, including additional power auctions and ensuring data centers pay for their energy usage.
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fox43.comIn a broader context, the hearing is part of a regional effort among lawmakers from Pennsylvania, New Jersey, Maryland, and Virginia to address energy affordability and reliability.During a previous multi-state policy hearing, lawmakers discussed the need for coordinated reforms to tackle rising electricity costs, which have surged nearly 15% in Pennsylvania over the past year.
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pagoppolicy.comwhyy.orgThe rising costs have been attributed to various factors, including infrastructure expenses and increased demand driven by data centers.A study by the Lawrence Berkeley National Laboratory indicated that the primary driver of electricity bill increases through 2024 would be the costs associated with transporting electricity, rather than the generation costs themselves.
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whyy.orgAs the hearing concluded, lawmakers acknowledged the urgency of finding solutions to the energy affordability crisis.The discussions highlighted the need for a balanced approach that considers both the economic implications of energy policies and the necessity of ensuring that all consumers can access affordable electricity.
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pagoppolicy.comwhyy.orgThe path forward will require collaboration among lawmakers, industry stakeholders, and consumer advocates to develop effective policies that address the challenges posed by rising energy costs while fostering a competitive environment for energy generation in Pennsylvania.
