Lawmakers Fail to Pass POWER Act While Continuing Big Tech Tax Incentives, Leaving Illinois Ratepayers to Continue Footing the Bill for Data Centers

SPRINGFIELD, IL – The POWER Act (SB4016/HB5513), a vital piece of legislation meant to shield communities across Illinois from data center impacts, failed to advance in the Illinois General Assembly as the legislative session ended yesterday. 

The bill would prevent tech companies from shifting their grid expansion and energy costs onto households, ensuring Illinois remains a leader in both tech innovation and environmental safety.  

The following is a statement from Kari Ross, Midwest energy affordability advocate, at NRDC (Natural Resources Defense Council): 

“This legislative session may have wrapped up, but the threat to our electric grid, our wallets, and our environment is only growing. It is deeply frustrating that the General Assembly did not cross the finish line this year while deciding to continue to provide millions of taxpayer dollars to data centers in incentives against the Governor’s vision. 

“NRDC and our partners will spend the coming months working closely with communities and lawmakers to show exactly why these guardrails are non-negotiable. If Big Tech intends to come to Illinois, they must pay for their own growth and play by the rules of transparency. We will be back next session to pass the POWER Act and secure the fair, affordable energy future that all Illinoisans deserve.” 

POWER Act highlights include: 

• Prohibit shifting data center costs onto consumers: New rules holding data centers accountable for their own energy needs will ensure that, during peak electricity demand, data centers can only use the amount of power proportional to the amount of new clean energy they bring to the grid. The policy will also protect consumers from subsidizing the costs of upgrading data center distribution and transmission infrastructure. 
• “Bring Your Own New Clean Capacity and Energy” (BYONCCE) Supply Plans: Data centers will be required to show how they will power their operations with new clean energy. These plans must rely on renewable energy and battery storage projects that can deliver electricity where the data center is located and add new power to the grid. Energy efficiency, flexible operations, and programs that reduce electricity use during peak times can also help meet this requirement. 
• Faster Grid Connection for Clean Energy Leaders: Data centers that demonstrate responsible clean energy leadership will be able to connect to the electric grid ahead of their competitors, incentivizing economic development that protects consumers and our climate. 
• Public Benefits and Affordability Fund: Calibrated to their size, all data centers will pay annually into a restricted fund administered by the Department of Commerce and Economic Opportunity (DCEO) and Illinois EPA to enhance: 
• Energy Affordability: Data center payments will be used to enhance DCEO utility-bill assistance (LIHEAP), shutoff avoidance assistance (UDAP), and whole-home retrofit incentive (IHWAP) programs for income-qualified electric customers. 
• Environmental Justice: Payments will enhance Illinois EPA grantmaking for projects such as air quality monitoring and water infrastructure improvements. 
• Protecting Consumers: Just like the electric grid, when a data center connects to our water utilities, they need to pay their fair share. Data centers need to show they are doing so with a transparent cost-of-service model. 

 NRDC (Natural Resources Defense Council) is an international nonprofit environmental organization with more than 3 million members and online activists. Established in 1970, NRDC uses science, policy, law and people power to confront the climate crisis, protect public health and safeguard nature. NRDC has offices in New York City, Washington, D.C., Los Angeles, San Francisco, Chicago, Beijing and Delhi (an office of NRDC India Pvt. Ltd).