AEP Ohio on Oct. 23 filed a settlement agreement that addresses the power needs of Ohio’s growing data center industry “while protecting AEP Ohio’s other customers,” the utility said.
The staff of the Public Utilities Commission of Ohio, the Ohio Consumers’ Counsel the Ohio Energy Group, Ohio Partners for Affordable Energy, and Walmart joined AEP Ohio in the filing.
AEP Ohio is part of American Electric Power, an investor-owned utility.
“While AMP supports the protections against stranded transmission costs included in the settlement filed by AEP Ohio, AMP did not join the settlement in order to preserve the right to ensure that funds collected by AEP Ohio are properly attributed to transmission customers that contribute to the infrastructure caused by the data centers,” said AMP's General Counsel Lisa McAlister.
AMP is the nonprofit wholesale power supplier and services provider for more than 130 municipal members in the states of Indiana, Kentucky, Maryland, Michigan, Ohio, Pennsylvania, Virginia, West Virginia, as well as the Delaware Municipal Electric Corporation.
The agreement, which is subject to review and approval by the PUCO, requires large new data center customers to pay for a minimum of 85% of the energy they say they need each month – even if they use less – to cover the cost of infrastructure needed to bring electricity to those facilities. It also creates a sliding scale that allows small and mid-sized data centers more flexibility. And it requires data centers to provide proof they are financially viable and able to meet those requirements, as well as to pay an exit fee if their project is canceled or unable to meet the obligations outlined in the electric service agreement contract.
The requirements would be in place for up to 12 years, including a 4-year ramp-up period.
The agreement also outlines a process to end the moratorium on new Central Ohio data center agreements.
The settlement filed by AEP Ohio, PUCO staff, the Ohio Consumers’ Counsel, OEG – a manufacturing coalition – and others is the latest in PUCO case no. 24-508-EL-ATA. The case began in May 2024, when AEP Ohio filed a proposal to reconcile the costs of infrastructure improvements required for Ohio’s growing data center industry.
Earlier this month, a group of data center industry leaders filed a separate agreement, which was not supported by AEP Ohio, the PUCO staff, OCC or OEG. They proposed to pay for a minimum of 75% of the energy they say they will use and excluded important customer protections and included other problematic provisions in their deal, AEP said.
Data center development has expanded rapidly in recent years across AEP Ohio’s service territory, especially in Central Ohio. Electricity demand in Central Ohio, driven largely by data centers, already is expected to more than double by 2030.
