AN ACT amending the utilities and tax laws relative to data centers.

The General Assembly of North Carolina enacts:

SECTION 1.(a)  G.S. 62‑3 reads as rewritten:

§ 62‑3.  Definitions.

As used in this Chapter, unless the context otherwise requires, the term:

…

(16a)    Large‑load data center means a facility (i) whose primary services are the storage, management, and processing of digital data, (ii) that is used to house computer and network systems, including associated components such as servers and other telecommunications equipment and appliances, and (iii) that has or is projected to have an aggregate demand of more than 20 megawatts. Facilities located on contiguous or adjacent sites shall be considered a single facility for purposes of calculating aggregate demand if under common ownership or effective control.

(16a)(16b) Local exchange company means a person holding, on January 1, 1995, a certificate to provide local exchange services or exchange access services.

…

(28a)    Tariff means any compensation, charge, fare, rate, schedule, toll, or classification demanded, observed, charged, or collected by any public utility, for any service product or commodity offered by it to the public, and any rules, regulations, practices, or contracts affecting such compensation, charge, fare, rate, schedule, toll, or classification.

….

SECTION 1.(b)  G.S. 62‑133.5(h)(1)a. reads as rewritten:

a.        Local exchange company. – The same meaning as provided in G.S. 62‑3(16a).G.S. 62‑3(16b).

SECTION 1.(c)  Article 7 of Chapter 62 of the General Statutes is amended by adding a new section to read:

§ 62‑133.25.  Electric service tariffs for large‑load data centers.

(a)        Each electric public utility shall file for Commission approval a tariff for the provision of electric service to large‑load data centers, as defined in G.S. 62‑3. This tariff shall be applicable only for customers that are large‑load data centers. However, the Commission may approve a tiered tariff schedule that includes different rates, terms, or conditions for different classes of large‑load data centers based on load requirements or other factors related to the cost of service.

(b)        Each tariff application filed with the Commission under this section shall be designed to ensure that large‑load data center customers are responsible for the entire cost of any capital investments or incremental operational expenses necessary for the utility to provide electric service to large‑load data centers and to protect other electric customers from incurring any rate increases caused by serving large‑load data center customers. Furthermore, tariff applications shall include provisions necessary to ensure that other electric customers are not placed at higher risk of shouldering any stranded costs as a result of large‑load data center customers ceasing operations or else consuming less electricity than initially requested.

(c)        The Commission shall require that each tariff filed by an electric public utility to serve large‑load data centers incorporate the following terms and conditions for the protection of other customers:

(1)        A minimum contract term that obligates a large‑load data center customer to take electric service for a term of no less than 10 years.

(2)        A minimum billing demand requirement that obligates a large‑load data center customer to take or pay, for a period of no less than 10 years following commencement of service, at least eighty‑five percent (85%) of the maximum electric service requested by the customer.

(3)        A financial assurance or surety requirement that is sufficient to protect other ratepayers against any material increase in rates occurring as a result of a large‑load data center customer ceasing operations or taking less service than initially requested.

(4)        A requirement that a large‑load data center customer give the electric public utility advanced notice prior to any anticipated reduction in its demand for electricity.

(5)        Any other provisions that the Commission determines to be reasonable and in the public interest.

(d)       The Commission may only approve a tariff application for providing electric service to large‑load data centers upon finding that the tariff, in addition to being just and reasonable and in compliance with the requirements of this section, includes rates, terms, and other conditions necessary to protect and hold harmless other electric customers from having to bear any increased costs attributable to serving large‑load data centers.

SECTION 1.(d)  This section is effective when it becomes law. The tariff application required to be filed with the Utilities Commission pursuant to G.S. 62‑133.25, as enacted by subsection (c) of this section, shall be filed by the electric public utility no later than 180 days after the effective date of this section. Effective January 1, 2028, an electric public utility shall not provide electric service to a large‑load data center except under the terms of a tariff approved by the Utilities Commission in accordance with G.S. 62‑133.25.

SECTION 2.(a)  G.S. 105‑164.3(47), 105‑164.3(79), 105‑164.3(201), 105‑164.13(43a)b., 105‑164.13(55), and 105‑164.13(55a) are repealed.

SECTION 2.(b)  This section becomes effective January 1, 2027, and applies to sales made on or after that date.

SECTION 3.  Except as otherwise provided, this act is effective when it becomes law.