As Introduced

136th General Assembly

Regular Session H. B. No. 706

2025-2026

To enact sections 4934.01, 4934.02, 4934.03, 4934.04, 4934.05, 4934.06, 4934.07, 4934.08, 4934.09, 4934.10, 4934.11, and 4934.12 of the Revised Code to impose certain minimum requirements on data center customers in the state.

BE IT ENACTED BY THE GENERAL ASSEMBLY OF THE STATE OF OHIO:

Section 1. That sections 4934.01, 4934.02, 4934.03, 4934.04, 4934.05, 4934.06, 4934.07, 4934.08, 4934.09, 4934.10, 4934.11, and 4934.12 of the Revised Code be enacted to read as follows:

Sec. 4934.01. As used in sections 4934.01 to 4934.09 of the Revised Code:

(A) "Electric distribution utility" has the same meaning as in section 4928.01 of the Revised Code.

(B) "Data center" means a centralized facility that:

(1) Is used primarily or exclusively for electronic information services such as the management, storage, processing, and dissemination of electronic data and information through the use of computer systems, servers, networking equipment, and related components;

(2) Has an aggregate monthly maximum demand of greater than twenty-five thousand kilowatts.

(C) "Data center customer" means a customer, or group of affiliated customers, of an electric distribution utility that own or operate a data center.

Sec. 4934.02. (A) An electric distribution utility shall not recover any distribution, transmission, or generation costs, including financial or operational risks associated with, or caused by, a data center customer from other customer classes unless the public utilities commission determines such recovery is just and reasonable.

(B) Prior to approving agreements under sections 4934.04 and 4934.05 of the Revised Code, and any cost recovery mechanism requested by the electric distribution utility based on those agreements, the commission shall determine that the approval will not increase rates for other existing customers. The electric distribution utility has the burden of proof in any such proceedings for approval of the agreements and related cost recovery mechanism.

Sec. 4934.03. An electric distribution utility shall not provide electric service to, or make any investments in infrastructure for, a data center customer that has not complied with the requirements stated in sections 4934.04 to 4934.07 of the Revised Code.

Sec. 4934.04. (A) A data center seeking electric service from an electric distribution utility shall enter into a binding commitment with the utility, which shall include the following:

(1) Minimum demand or usage commitments that are in addition to the requirement described in section 4934.05 of the Revised Code;

(2) Long-term service agreements;

(3) Exit fees or liquidated damages;

(4) Collateral, guarantees, or other financial assets.

(B) An agreement under this section is subject to approval by the public utilities commission.

Sec. 4934.05. (A) A data center customer shall enter into an agreement with the electric distribution utility, subject to approval by the public utilities commission, agreeing to a minimum billing demand sufficient to support data center customer infrastructure planning and cost recovery from data center customers. The utility shall determine the minimum billing demand, contract terms, any ramp periods, additional financial assistance, and any other terms the utility determines are necessary to address reliability needs, protect against stranded asset costs, and to comply with section 4934.02 of the Revised Code.

(B) Notwithstanding division (A) of this section, the minimum billing demand for a data center customer that has reached full commercial capacity shall be not less than eighty-five per cent of contracted capacity, and the minimum contract term shall be not less than twelve years, inclusive of any approved load ramp period up to four years.

Sec. 4934.06. (A) Prior to commencing construction of any transmission or distribution facilities dedicated in whole or in part to a data center customer, the public utilities commission shall require each data center customer to provide financial assurance to the applicable electric distribution utility to protect other customer classes from costs arising from the data center customer prematurely exiting, downsizing, defaulting, or otherwise disconnecting, or reducing, electric service contrary to the agreement made under section 4934.05 of the Revised Code and may include the following:

(1) Exit fees or liquidated damages;

(2) Letters of credit or cash collateral;

(3) Parental or affiliate guarantees.

(B) The financial assurance described in division (A) of this section shall be adequate to cover the unrecovered net book value of all dedicated facilities, minimum billing exposure, and any applicable exit fees.

Sec. 4934.07. The financial assurance required under section 4934.06 of the Revised Code shall be reviewed and adjusted at least biennially by the electric distribution utility to reflect remaining unrecovered investment and risk of exit and downsizing or cessation of operations.

Sec. 4934.08. The requirements stated in sections 4934.04 to 4934.07 of the Revised Code shall be construed as minimum requirements. Nothing in those sections shall preclude the public utilities commission from imposing more stringent requirements.

Sec. 4934.09. Any exit fees, collateral forfeitures, or unused-capacity payments collected from a data center customer shall be credited to retail customers in the next available rate period or deferred as regulatory liabilities for the benefit of customers. An electric distribution utility shall not retain such revenues as utility earnings.

Sec. 4934.10. Not later than six months after the effective date of this section, the public utilities commission shall establish uniform statewide standards governing the following:

(A) Load study deposits, including nonrefundable components;

(B) Queue-position forfeitures for failure to meet milestones;

(D) Aggregation of affiliated projects for queue priority.

Sec. 4934.11. Notwithstanding any provision of section 121.95 of the Revised Code to the contrary, a regulatory restriction contained in a rule adopted under section 4934.10 of the Revised Code is not subject to sections 121.95 to 121.953 of the Revised Code.

Sec. 4934.12. Nothing in this chapter is intended to restrict or modify the public utilities commission's authority under section 4905.31 of the Revised Code.