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HD 5404

An Act relative to the cost of electricity at large and qualified data centers

194th Legislature (2025-2026) Introduced by Rodney Elliott and 1 co-sponsor

Prevents residential and income-eligible customers from rate increases or reduced electricity availability due to data centers, while giving the department oversight over data-cent

Referred to the committee on House Rules
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Bill Summary · HD 5404

Summary: An Act relative to the cost of electricity at large and qualified data centers (HD 5404)

Purpose and intent

  • Establishes protections to prevent residential and income-eligible customers from experiencing rate increases or reduced electricity availability due to the construction or operation of large and qualified data centers.
  • Empowers the state department to review and oversee rates and cost-structures associated with data center electricity sales to ensure cost shifts to non-data-center customers are avoided.

Key definitions (Section 152(a))

  • “Large data center” or “qualified data center” means a facility in Massachusetts that:
    • Uses 10 megawatts (MW) or more, and
    • Is composed of one or more buildings on a single parcel or contiguous parcels, primarily housing IT equipment (servers, routers, data storage, etc.).

Main provisions (Section 152(b)–(c))

  • Rate protection for residential and income-eligible customers:
    • A distribution company shall not reduce electricity availability to, or increase rates charged to, residential or income-eligible customers because of the construction, operation, or use of electricity by large or qualified data centers.
  • Department review and oversight:
    • The department shall review the distribution company’s rates and terms for electricity sales to these data centers to prevent cost increases being passed to residential customers.
    • The distribution company must provide records to the department related to:
    • Cost attribution to data centers and any build-out or interconnection agreements.
    • Ongoing electricity sales connected to data centers.
  • Regulatory authority:
    • The department may promulgate rules and regulations necessary to implement and enforce these provisions.

Who would be affected

  • Large and qualified data centers (10 MW+ facilities) operating in Massachusetts.
  • Distribution companies serving electricity to such data centers.
  • Residential and income-eligible customers who receive electricity service from these distribution companies.

Procedural and timeline aspects

  • The bill adds a new section to Chapter 164 (Section 152) but does not specify an effective date within the text provided.
  • It contemplates ongoing departmental review and annual or periodic reporting through record-keeping requirements, with authority to issue implementing regulations.

Potential impact and considerations

  • Economic: Aims to preserve competitive electricity pricing for non-data-center customers while allowing data centers to operate with transparent interconnection and cost data.
  • Transparency: Requires data-center-related cost attribution and interconnection records to be shared with the department, increasing oversight.
  • Regulatory: Establishes a mechanism for ongoing regulatory scrutiny of data-center electricity economics, potentially influencing rate design, interconnection agreements, and incentive programs.
  • Policy balance: Seeks to attract data-center growth while protecting ratepayers from cross-subsidization or unexpected rate hikes.

Compiled from official sources — confirm details with the bill’s official record.

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