EKPC’s tariff provides strong protections to ensure the costs of serving data centers are not shifted to other cooperative members. Here are just a few examples:
Data centers pay their own way. The DCP tariff requires capital costs to be paid up front for new power plants or power line infrastructure needed to serve the facility. It also requires estimated operating costs to be paid months ahead of time on a rolling basis; EKPC and the retail distribution cooperative will invoice and withdraw payment from the prepaid account, providing assurance of liquidity.
Large data centers must have dedicated power plant resources. For data centers that use 250 megawatts or more of electricity, the DCP tariff requires a dedicated electric-generating resource. This ensures a data center does not simply buy power from the grid and hope enough power plant capacity continues to be available. The tariff provide flexibility; for example, a new power plant could be built by EKPC to serve the data center, or a power plant could be owned by another entity that provides power under a purchase agreement. Consistent with the principle that data centers must pay their own way, the costs of a dedicated resource are paid for by the data center and not other customers.
Fair allocation of costs/risks. The DCP tariff assures that costs and risks are appropriately identified and allocated between the data center and other co-op members, based on the principal that data centers should bear any cost or risk they cause.
Defining what is and is not a data center. The tariff defines data centers as facilities with maximum capacity of 15 megawatts or more, and that operate at 60 percent or more of their capacity on an ongoing basis. This combination of characteristics makes data centers unique among electric users.
Data centers must submit an application and pay for preliminary studies. In order to serve large users and protect reliability for everybody, EKPC and its reliability coordinator must conduct detailed studies and modelling of the proposed facility and its effect on regional power flows. To start that study process, EKPC requires prospective data centers to submit an application and pay an upfront fee of up to $250,000. This fee reimburses the cost of staff time and other resources, and helps to ensure the prospective data center is serious about pursuing their proposed project. If the cost of studying how to integrate a data center into the EKPC system exceeds the application fee, the data center pays that cost as well.
Regulatory oversight of contracts implementing the tariff. The DCP tariff provides guidelines for our cooperatives to develop a three-way contract between the data center developer, the local retail cooperative and EKPC. This contract must be reviewed and approved by the Kentucky Public Service Commission before it goes into effect.
