Sarah: Everybody wants the data center.
Sarah: Fewer people want the transmission bill.
Matt: This is The Data Center Daily.
Matt: Microsoft, regulators, and ratepayer advocates have suddenly landed in the same fight—and the water tab is getting harder to ignore.
Matt: One tap on follow, and we'll be back in your ears before you know it.
Sarah: From Paul Kiefer at Wisconsin Watch:
Quote: Microsoft and Wisconsin ratepayer advocates are asking federal regulators to hit the brakes on a proposal to allocate the costs of
Quote: transmission infrastructure built to serve data centers.
Quote: Both argue that We Energies and the American Transmission Company’s (ATC) recent proposal to federal regulators fails to adequately protect
Quote: Wisconsinites from picking up the construction bill
Quote: among other concerns.
Sarah: Microsoft and Wisconsin ratepayer advocates are both asking FERC to slow ATC and We Energies down.
Sarah: Odd coalition: the hyperscaler and the people worried about their electric bills agree the paperwork needs work.
Matt: ATC expects more than $500 million for the Mount Pleasant connection, and somebody has to wear that number.
Matt: A 15-year minimum charge sounds solid until the load comes in lighter than forecast—or walks.
Sarah: We Energies says transmission already makes up about 10% of customer bills.
Sarah: Its proposed floor is meant to keep overbuilding costs off everyone else
Sarah: but Microsoft and the advocates say the FERC structure still leaves too much exposure.
Matt: And the PSC can’t simply make ATC bill Microsoft for the whole tab.
Matt: FERC holds that lever, so Microsoft is now in the federal proceeding over its own grid bill.
Matt: Funny how quickly a giant customer discovers consumer protection.
Sarah: From Maeve Allsup at Latitude Media:
Quote: It’s been two years since Pacific Gas and Electric first launched its flexible interconnection program on the distribution grid. The program
Quote: dubbed “Flex Connect,” is designed as a workaround to getting distribution-level projects connected faster if they rein in their demand
Quote: during peak hours. Standardizing that offering
Quote: integrating it into PG&E’s distribution planning process
Quote: and then accelerating the pipeline has been a significant and time-consuming undertaking.
Sarah: PG&E’s first flexible data-center connection lands this fall: a 5-megawatt Bay Area site on non-firm service.
Sarah: Small, yes—but it has an in-service date, which already puts it ahead of a lot of grander interconnection announcements.
Matt: Now comes the part the paperwork loves to blur: when PG&E calls during a peak, does that 5-MW site actually back off?
Matt: Flex Connect means faster power in exchange for curtailment.
Matt: We’re about to find out whether the customer treats that as a contract or a suggestion.
Sarah: The rollout has been slower than the original forecast—PG&E wanted 10 sites online by the end of 2025 and finished with five.
Sarah: But seven projects are now operating
Sarah: two have graduated to firm service after upgrades
Sarah: and roughly 85 sites sit in the assessment pipeline.
Sarah: A real distribution-level program is taking shape.
Matt: And after the ATC fight we just covered
Matt: here’s the useful counterexample: PG&E is offering conditional access up front instead of building first and arguing over a giant
Matt: transmission bill later.
Matt: Fine. But 85 interested sites are not 85 loads that have proven they’ll curtail.
Sarah: West Virginia Gazette-Mail, with Mike Tony:
Quote: The staff of the West Virginia Public Service Commission has made a case to the agency that it should consider dismissing the application
Quote: it’s considering for regulatory certification of a deeply unpopular
Quote: $1 billion-plus regional interstate power transmission line project.
Quote: The PSC staff has recommended a pause in the commission’s consideration of the application for NextEra Transmission MidAtlantic Inc.’s
Quote: planned $1.16 billion MidAtlantic Resiliency Link project,
Matt: NextEra filed a $1.16 billion, 107.5-mile, 500-kV line in January.
Matt: Now West Virginia PSC staff says pause it for 60 days, or dismiss it if the company won’t toll the deadline.
Matt: Turns out landowners want to know their property is on the route before the clock runs out.
Sarah: The Oct. 26 evidentiary hearing is still on the calendar, but PSC staff is challenging the process underneath it.
Sarah: Newly affected landowners need due process, and staff needs time to investigate.
Sarah: PJM’s endorsement may support the need case, but it doesn’t waive the hearing record.
Matt: And it lands right after the Microsoft-ATC fight we just covered.
Matt: Same tension: developers want transmission moving now
Matt: while regulators and everybody holding the bill ask whether the load forecast—and the route—can survive contact with reality.
Sarah: A 500-kV line isn’t a site reservation.
Sarah: NextEra has a live choice before the PSC: agree to tolling, or risk having the certification application dismissed.
Sarah: Here's Latitude Media:
Quote: The debate over data centers’ water use tends to focus on how much is needed to cool servers on-site.
Quote: But that fails to capture the largest and least visible part of their overall use: the water used at the power plants fueling data centers’
Quote: rising energy needs.
Quote: Only one hyperscaler, Meta, reports its indirect water consumption embedded in purchased electricity.
Sarah: Ceres puts the electricity-side water bill at 3.4 trillion gallons across seven states in 2024—about 12 times the combined use of Los
Sarah: Angeles Phoenix and Washington
Sarah: D.C. That’s the water meter the on-site cooling debate keeps missing.
Matt: And two-thirds of the plants Ceres examined sit in medium-high to extremely high water-stress areas.
Matt: Arizona is already in drought; Illinois is leaning on water-intensive nuclear in the Mississippi-Missouri basin.
Matt: Great place to hide a consumption number—in somebody else’s power plant.
Sarah: Meta is the only major hyperscaler publicly reporting this indirect figure
Sarah: and it was more than 20 times its direct data-center water use in 2024.
Sarah: Amazon says it tracks the number but is still working on a framework; Google and Microsoft wouldn’t say whether they track it.
Sarah: Grid costs aren’t the only hidden footprint that deserves scrutiny.
Matt: Ceres projects four to eight trillion gallons by 2030.
Matt: So when somebody sells a low-water campus
Matt: ask what generation serves it
Matt: where that plant pulls water
Matt: and whose watershed gets volunteered for the AI boom.
Host: If you follow the data center world
Host: you may also enjoy AI Daily Briefing: top AI news for engineers
Host: founders and investors every weekday
Host: with real capabilities versus demo hype explained fast.
Host: Find it wherever you listen to podcasts.
Host: Looking ahead, PG&E plans to bring its first flexible data center site online this fall: a 5-MW facility in the Bay Area.
Host: And the West Virginia PSC evidentiary hearing on NextEra’s MARL project is scheduled to start October 26
Host: unless the proceeding is tolled or dismissed.
Host: Links to every story are in the show notes, so take a look at the ones you’d like to explore further.
Host: That’s The Data Center Daily for today.
Host: This is a Lantern Podcast.