Indiana just ran Google's data center through a cost test. Today we find out what passing actually means. Quick catch-up before we dig in: in September, Governor Newsom signed a seven-bill data center package his office called the most comprehensive in the nation. There's a ratepayer protection act that hands the CPUC interconnection, cost allocation, collateral and termination rules, plus energy and water disclosure bills and some environmental review changes. The ink's dry. Now it's about how regulators and local permitting agencies actually put all that into practice. This is The Data Center Daily. Google found new power inside reactors that are already running. Great. When does it actually show up? Plus California ties water to permits, and a very quiet building in Cardiff. First, Indiana. This story isn't over: California data center ratepayer protection implementation. Follow us wherever you're listening, and the next chapter comes to you. Here's Zak Cassel at WFYI Public Media:
Indiana utility regulators unanimously approved a plan for utility AES Indiana to build the solar, battery storage and electric line project needed to power a 390-megawatt Google data center project in Monrovia. At the Oct. 7 meeting, the Indiana Utility Regulatory Commission said the proposed project meets a 2025 state law that requires data centers and other large electricity users to cover 80% of costs reasonably assigned to it.
Okay, Indiana. Unanimous vote, AES gets its solar, batteries and lines for Google's 390 megawatts in Monrovia, and AES says Google pays for all of it. Then the commission's own order says it's reasonable to hand existing customers a share of the upgrades. And that share has a number. Seventy-three point eight million in network upgrades goes into AES's transmission rate base. The IURC found on October 7th that the deal meets the 2025 law's 80% standard. Eighty's not a hundred, and the rate base is where you see the gap. Commissioner Jerrells says it 'exceeds it substantially.' Citizens Action Coalition objected, and ratepayers carry that 73.8 until Google's payments supposedly cover it. I'll give them the 15-year contract and the exit protections. That part protects people. I'd just like to see what it costs Google to actually use that exit. It's the first data center filed under the law, so everyone after Google gets this template. And after three days of the same fight in Washington, it's kind of nice to read it in a state's written order, footnotes and all. Global Data Center Hub writes:
First, a 20-year power purchase agreement backs 890 MW of added output at 11 reactors in Illinois, Pennsylvania and New Jersey. Constellation says it will invest more than $4.3 billion in the work. The first uprate is expected by 2028. All 890 MW is due before the end of 2032.
Okay, I'll say it. This one's real paper. Twenty-year PPA, signed, and Constellation's putting more than four-point-three billion of its own money into eleven reactors that are already running. So let's sort the megawatts before somebody adds them up wrong. Eight-ninety is new output from uprates in Illinois, Pennsylvania, and New Jersey. The twenty-seven hundred is existing fleet on a separate fifteen-year deal. Kept on the grid, not added to it. And the new part runs on a slow clock. First uprate by 2028, all eight-ninety by end of 2032. Anybody saying Google 'found' nuclear power should staple a calendar to it. Plus two approvals nobody's banked yet. NRC has to sign off on the uprates, and FERC still has to rule on how PJM counts that output. That FERC piece is where I'd be looking. And Google's demand-response clause, cutting non-critical load during grid stress? Sure. Show me it working on a bad August afternoon before I count it as a backstop. Here's Tara E. Paul at The Legal 500:
AB 2469 adds a new section to the Government Code (Section 65964.7) that prohibits a city, county, or city and county from approving any discretionary or ministerial permit for the construction of a new data center, or an expansion that increases maximum peak water use, unless the applicant satisfies a series of disclosure and planning requirements.
Now this one I actually like. Under AB 2469, no city or county signs a permit for a new data center, or an expansion that bumps peak water use, until you've disclosed the water and shown the supply's really there. Permitting people, this is your bill. And it's a do-over. Newsom vetoed AB 93 last year, per The Legal 500. 2469 and 2619 are the successors, signed September 21 and live January 1, 2027. So we're past signatures and into compliance, and the teeth are a permit bar right at the city and county counter. Wait, back up to 'expansion that increases maximum peak water use.' That's your cooling retrofit. Somebody swaps chillers in Santa Clara, and suddenly they're doing a water supply assessment and a drought contingency plan. So who eats that, the developer or the tenant's next lease? The next lease. It's always the next lease. Allen Matkins says the expansion language could capture retrofits, so if I'm running a California portfolio, I'm budgeting for it now, not litigating it in 2027. From The Edge Malaysia:
Keppel DC REIT has acquired a 100% stake in a data centre located in Cardiff, United Kingdom, for £34 million (S$59.3 million). The data centre is currently leased to one of the largest global cloud services providers, on a triple-net lease for 15 years which started in June, according to a filing to the Singapore Exchange on Thursday.
After an hour of rate bases and reactor timelines, we get a two-storey building in Cardiff with a tenant already inside. Honestly? I kinda love it. Keppel DC REIT took a hundred percent of it for £34 million, about S$59.3 million. Fifteen-year triple-net lease to one of the biggest cloud providers, running since June. And for the calendar-minded, that's the October 6 filing, not a fresh deal today. Triple-net. So the tenant eats taxes, insurance, upkeep. Nobody's sliding seventy-three million in upgrades into somebody's rate base, like the Indiana piece we just hit. Footnote check, though. CBRE valued the stake at £34.0 million as of September 15. So they paid appraisal to the pound, and every bit of it's bank-funded. All borrowed. So the whole trade is rent escalators beating the loan. That's the part I'd squint at. Portfolio lease life goes from 8.7 to 9.5 years, master-leased share from 31.6 to 35 percent. And the market's verdict? Units down 0.8 percent to S$1.21. Riveting. If you work around data centers, you might also like AI Daily Briefing: top AI news for engineers, founders, and investors, with real capabilities versus demo hype explained fast, every weekday. Find it wherever you listen to podcasts.
We're watching California's data center water bills, AB 2469 and AB 2619, which take effect January 1, 2027. Starting then, local permits for new data centers or water-intensive expansions need the new disclosures and planning.
Links to every story are in the show notes, so dig into whichever ones grab you. That's The Data Center Daily for today. Thanks for listening, and we'll be back tomorrow. This is a Lantern Podcast.