Some data centers are building their own power plants. In Oklahoma, most want to plug into the grid

A little over a year ago, a new Oklahoma law took effect allowing big energy users like data centers to build their own power plants. The move was expected to generate billions in private investment and alleviate electricity demand. But as state impacts Chloe Bennett Steel reports, most data centers are opting to plug into the grid. We're here today to continue the incredible progress we're making in communities nationwide to ensure that as new data centers go up, And they're going up all over. Electricity bills for American families will actually come down. President Donald Trump in July announced new signatories of the rate payer protection pledge. It's a document calling on AI companies, utilities, and governors to ensure households don't see monthly electricity bills balloon as hyperscale data centers are built. Governor Kevin Stitt and several Oklahoma utilities signed on. Part of the pledge says companies must either add power to the grid. buy from new plants or build their own. You know you're going to be building your own data centers and you're going to build building your own electric plants. You're essentially becoming a utility. Many data centers around the U.S. are planning behind the meter projects. That means generating power on site or nearby, bypassing utilities. Data center proponents say it could help protect residential rates. Republican Representative Brad Bowles co-author the states behind the meter law Senate Bill 480 last year. What we realize is in Oklahoma... Our state law is kind of vague. It doesn't really say that companies can provide their own power generation. It doesn't say they can't either. And so we wanted to provide clarity that if a large load comes to Oklahoma and they want to provide their own power generation, that they would have the ability to do that. Bowles says there are a couple of reasons why data centers getting their power behind the meter could benefit regular rate payers. Number one, the private companies take their own risk. So they would have to spend their own capital expenditures for their power generation infrastructure. And so that takes a lot of pressure off the grid and from rate payers. And then number two, if that company doesn't make it, because, you know, obviously we want everyone to be successful, but it doesn't always work like that in business. So if they weren't successful and they go out of business, then the people that lose are their investors and the private company. Not ratepayers. But plans for behind-the-meter projects are largely absent from data center announcements sprouting up across Oklahoma. Most plan to plug into the grid, fueling concerns over rising electricity rates. Experts say the grid is more reliable than on-site generation. There could be a plant built in Chickashe to power a future data center, but no firm plans have been made public since its announcement last year. Joshua Rhodes is a research scientist at the University of Texas at Austin. He studies the electric grid and the data center boom. He says building power plants is a tough cell for AI companies.

So I don't really actually believe that any data center company wants to also be in the power business. They're kind of being forced into that because they just can't get the electricity from the grid fast enough. Neighboring Texas has at least 15 behind the meter projects planned. Rhodes says it's a volume thing. Texas has hundreds of data centers in its queue where Oklahoma has fewer than 30. Securing a natural gas plant, the typical energy source for these facilities, can take years because of a mile-long backlog. And while developers could use other energy sources, Oklahoma's behind the meter law would require them to generate natural gas. If you're not already in line, you're not getting a power plant until the 2030s. And so it's like, you know, it's not something you can just order on, you know, Prime and get it the next day. Like, it's going to, there's, it's going to be a while before you can get it if you're not already in line. Rhodes says he's heard of companies looking to buy used cruise ship engines or string together helicopter engines to supply power. And while those kinds of projects aren't happening in Oklahoma today, Bowles says it could be a different story tomorrow. You know, like anything, it takes time. Like if you're to build a facility with behind the meter, you know, it may take three to five years to get the power infrastructure built. So I think we're not going to really know for sure how many companies are utilizing this until a few years down the road. In the meantime, communities from Yukon to Claremore continue grappling with data center proposals. For State Impact, I'm Chloe Bennett's deal. State Impact is a collaboration of NPR member stations in Oklahoma. You can find and follow State Impact on Facebook, Instagram, and X at State Impact OK.