Florida utility regulators rejected Duke Energy Florida’s proposal to meet the requirements of a new state law intended to shield ratepayers from the costs of data centers.
The Public Service Commission voted against Duke’s proposal to create a new large load tariff designation for data centers in the first test of the law pushed in the spring by Gov. Ron DeSantis intended to ensure customers won’t bear the additional costs brought by new facilities that power artificial intelligence.
Commissioner Gabriella Passidomo Smith said the new law “made it clear that large load customers must bear their own full cost of service without shifting those costs to other ratepayers.”
Smith added that Duke can serve the large-scale data centers, which require vast amounts of energy to power the burgeoning AI field while still following the new law.
Brooke Ward, Florida State Director for Food & Water Watch, called the vote “a victory for affordability and testament to the importance of laws that put people above corporations.” But she added the state needs more affordable energy legislation to “ensure a more equitable energy future for all Floridians.”
The new law (SB 484) requires the PSC to develop what are known as “tariffs” and service requirements to “reasonably ensure that each large load customer bears its own full cost of service and that such cost is not shifted to the general body of ratepayers.”
That would include costs related to connecting to electric systems and increased power transmission and generation costs.
The measure reinforces the ability of local governments to refuse to build data centers in their jurisdictions. But it also allows city and county governments to enter into non-disclosure agreements with tech companies for up to 12 months, which would hide data center proposals from the public during that time.
Duke will have to refile a new tariffs proposal.
The commission determined Duke’s proposed tariffs excluded certain large load customers who would otherwise qualify under the law’s definition.
Commissioners also found Duke failed to provide sufficient evidence to demonstrate that its existing rate schedules, together with the proposed contractual and financial protections, would reasonably ensure that each large load customer bears the full cost of its electric service.
