Lawmakers press PUC on data centers and Minnesota Power sale as communities raise NDA and transparency worries

Senators on the Energy, Utilities, Environment and Climate Committee raised questions on Feb. 25 about how the 2024 data-center tariff law will operate in practice and about community reactions to large utility transactions.

Mr. Bull, testifying for the Public Utilities Commission, described the 2024 law as creating a distinct large-customer class for data centers so that costs of serving those customers are borne by that class rather than other customers. "That's what the legislation calls data centers: a very large customer class... to ensure that all costs associated with serving that customer class will be paid by that customer class and not charged to any other customers," he said, noting dockets are pending for Xcel Energy and Minnesota Power and that an electric service agreement is likely to follow the Pine Island data-center announcement.

Several senators, particularly those representing northeastern Minnesota and rural districts, expressed deep concern about transparency and local impacts after recent events. Senator McEwen (Duluth) recounted community opposition to the Minnesota Power sale to a Canadian pension fund and Global Infrastructure Partners, saying an administrative-law-judge recommended against approval and nearly 500 public comments opposed the sale. She said she was troubled to learn, via public-record requests, that developers had asked some local public officials in St. Louis County to sign nondisclosure agreements while planning a proposed hyperscale data center in Hermantown.

"We found out in September that this had happened... hundreds of people came out to the Hermantown City Council," she said, adding that community organizers have been active in opposing the proposal. She said the PUC denied a renewed petition to re-open its review of the Minnesota Power sale and that many in her region feel betrayed.

Senator Matthews and other legislators pushed back about economic-development consequences, describing a Becker project that local officials say was chilled by hostile public reaction and warning that communities driven to use NDAs risk moving projects out of state. The chair pointed senators to a packet article on the newly announced Pine Island data center and highlighted a $5,000,000 low-income weatherization calculation included in the data-center deal.

PUC officials acknowledged the community concerns and said they would continue to update the committee though they did not announce any reversal of prior PUC decisions during the hearing.