Electrical corporations: data centers: report.

Senator Padilla, joined by Senators McNerney and Stern, advances a measure to give the Public Utilities Commission a temporary, analytical role in examining how new data-center loads may affect electricity costs for other customers. The proposal would authorize the commission to assess the extent to which costs associated with data-center growth could shift onto non–data-center ratepayers, and to consider factors such as procurement costs to meet rising data-center demand, costs for new transmission and distribution assets—including stranded assets and assets installed for an entity that ceases operation—and opportunities to prevent or mitigate any identified cost shifts. If the commission undertakes the assessment, it would be required to report the results to the Legislature and publicly post the findings by January 1, 2027.

The measure is designed as a temporary, information-gathering instrument. It provides that the new authority is repealed on January 1, 2031 and does not attach an appropriation or impose mandatory rate changes; rather, the commission’s work would consist of an assessment that may be completed at the commission’s discretion and, if completed, transmitted to relevant policy committees and published on the commission’s website by the 2027 deadline.

Findings accompanying the proposal frame data-center growth as a calibration point for California’s climate and ratepayer goals, noting that large loads can influence grid efficiency and asset utilization, while also recognizing potential ratepayer benefits from efficient cost allocation. The bill leaves definitions broad and processes undefined, including what constitutes “data centers,” “new loads,” and “cost shifts,” and it does not mandate stakeholder engagement or specify a detailed methodology. The surrounding framework of existing rate-setting authority remains unchanged, and the measure’s sunset creates a finite window for the analytic review and its potential use in future policy discussions.