A bipartisan Senate bill that would speed up permits for energy projects would also make data center developers pay for both new and existing transmission infrastructure, The Verge reported on 6 November (The Verge). The Senate could vote to move the Bipartisan American Affordability and Jobs Act (BAAJA) forward as early as next week, according to the Bipartisan Policy Center, per the report.
Senators Shelley Moore Capito (R-WV), Sheldon Whitehouse (D-RI), Mike Lee (R-UT) and Martin Heinrich (D-NM) introduced the bill, S. 5653, on 30 September, according to a Congressional Research Service summary (CRS).
Business Pill · Who Pays for the Grid
A short explainer on how grid costs are allocated between customers. It teaches the general idea only and does not discuss this bill.
The key insight: The bipartisan Senate permitting bill BAAJA (S. 5653) would set a 45-day NEPA decision deadline and a 150-day window to sue, and would require data centers to pay for both new and existing transmission, per The Verge and the CRS; a Senate vote could come as early as next week, according to the Bipartisan Policy Center.
The bill mandates what The Verge describes as “and pricing”, so that data centers and other large electricity customers would be on the hook to pay for both added and existing infrastructure. Current law prevents utilities from charging them for costs stemming from both new builds and existing infrastructure, which shifts costs to other customers, per the report.
It would also require utilities to disclose electricity sales to data centers, The Verge reported. Large data center developers would have to make financial assurances to utilities before they break ground and cover costs of new energy projects even if the data center shutters before the infrastructure is paid off, per the report. The CRS summary says Section 2107 would direct the Federal Energy Regulatory Commission to change how transmission costs are charged to “computational load owner[s]” and affirm state authority over electricity rates for new data centers.
Deadlines in the Bipartisan American Affordability and Jobs Act (S. 5653) as introduced: 45 days for a NEPA decision after review (per The Verge), 60 days for formal ESA consultation, down from 90, and 150 days to sue over NEPA (per the Congressional Research Service).
What It Would Speed Up
The bill would set a 45-day deadline for a lead agency to issue a decision on a project after completing an environmental review under the National Environmental Policy Act, per The Verge. It would set a 150-day limit to challenge a project in court over alleged NEPA violations, according to both The Verge and the CRS summary, and, per the CRS, cut the deadline for formal Endangered Species Act consultation from 90 days to 60 days.
By our arithmetic, the consultation deadline would fall by a third. The NRDC estimates the bill could shorten the time needed to build a new transmission line from 10 years or more to around five or six years, The Verge reported.
Who Backs It and Who Objects
Whitehouse said in the press release: “If we can pass this bill, we will flood the grid with clean, affordable energy and make data centers start paying their fair share”. Xan Fishman of the Bipartisan Policy Center told The Verge it is “a really good bipartisan compromise”, and the US Oil & Gas Association said: “Pass the frickin’ bill so we can start building things again”.
Christy Goldfuss, executive director of the NRDC, told The Verge: “with this legislation, data centers would not need to answer to the concerns of local communities”. Earthjustice Action president Abigail Dillen wrote that it “will enable fast delivery of gas to fuel the data center build-out”, per the report.
Where It Sits After the Election
The Verge reported that the change in Congress after the midterms gives Democrats a better shot at pushing their priorities in the bill, and that newly empowered Democrats could decide to drag out debate until next year. Fishman told the outlet the White House has been “very involved” in negotiations.
As we read the report, the data center provisions are about who pays for the grid: the bill moves transmission costs and default risk from other customers to large computing loads, per The Verge.
As we read it, the speed provisions and the cost provisions pull different groups behind the same bill; The Verge reports support from climate groups and the US Oil & Gas Association alike.
As we read the numbers, cutting formal ESA consultation from 90 to 60 days is a one-third reduction, by our arithmetic; the other deadlines are new limits rather than cuts.
Sheldon Whitehouse (D-RI), in the bill’s press release, as quoted by The Verge
“If we can pass this bill, we will flood the grid with clean, affordable energy and make data centers start paying their fair share”
Three Implications
FOR DATA CENTER DEVELOPERS They would pay for added and existing transmission and post financial assurances before breaking ground, per The Verge.
FOR UTILITIES They would have to disclose electricity sales to data centers, per The Verge.
FOR TIMING The Senate could vote to move the bill forward as early as next week, according to the Bipartisan Policy Center, per The Verge.
The analysis says: “But infrastructure reality is catching up with AI ambitions: a projected 19GW gap between new data center demand and available grid capacity threatens to deflate the AI bubble.”
As we read it, permitting speed and grid cost allocation are two of the constraints that analysis describes; it does not discuss BAAJA or this vote.
What Is Not Established
No Senate vote has been scheduled publicly; the timing comes from the Bipartisan Policy Center, per The Verge. The household bill savings cited by the White House and Rhodium Group, and Resources for the Future’s electricity cost projection, are modelled estimates, per The Verge. The bill as introduced may change in the Senate.
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BAAJA, introduced by two Republican and two Democratic senators, would shorten federal permit and court timelines and require data centers to pay for new and existing transmission and post financial assurances, and require utilities to disclose electricity sales to data centers, per The Verge and the CRS. A Senate vote to move it forward could come as early as next week, according to the Bipartisan Policy Center.
A note on sourcing. Provisions, timing and reactions are as reported by The Verge and summarised by the Congressional Research Service for the bill as introduced; household bill and electricity cost figures are modelled estimates from the groups named. The one-third arithmetic is ours.
Gennaro Cuofano is a CRO and tech executive who has worked in AI since late 2015, starting with bringing NLP, natural-language generation, voice and chatbot products to the marketing industry. His background is in law and finance: he holds a Master's degree in Law and an International MBA with an emphasis on corporate finance (LUISS Business School and the University of San Diego, 2012), and worked as a financial analyst at a real-estate investment firm in San Diego and as an assistant controller. His work focuses on business model strategy, business engineering and, more broadly, structural analysis: how companies make money, read from their own filings. He created FourWeekMBA and leads research there and at The Business Engineer, his newsletter on AI and business strategy, with over 95,000 subscribers and more than 1,000 published analyses. His writing has also appeared on Entrepreneur (for example, How to Digitize a Family Business in Europe) and HackerNoon. Find him on LinkedIn and Substack. See how we source.
