Daily on Energy: Who’s covering the costs to power a Google data center?

WHAT’S HAPPENING TODAY: Good afternoon and happy Tuesday, readers! The MLB playoffs are kicking off today with four wild card games. Maydeen, as always, will be cheering for her Los Angeles Dodgers as they set their sights on a three-peat. ⚾💙Plus, today is the last day to vote in Fat Bear Week! Be sure to cast your final vote for the fattest bear here. 🐻🐟🗳️Welcome to Daily on Energy, written by Washington Examiner energy and environment writers Callie Patteson (@CalliePatteson) and Maydeen Merino (@MaydeenMerino). Email cpatteson@washingtonexaminer dot com or mmerino@washingtonexaminer dot com for tips, suggestions, calendar items, and anything else. If a friend sent this to you and you’d like to sign up, click here. If signing up doesn’t work, shoot us an email, and we’ll add you to our list. WHO’S PAYING TO POWER A GOOGLE DATA CENTER IN ARKANSAS? In West Memphis, Arkansas, a data center project has come under fire as questions arose over how much consumers would have to pay to power the new artificial intelligence-facility, despite Google saying it would fully cover the costs. The concerns primarily stemmed from a report by the Arkansas Democrat Gazette, which claimed it had obtained documents that said Google would only pay for a third of the cost needed to construct the power plant, Cypress Solar, that would generate energy for the data center. But according to Entergy, the utility responsible for building, owning and operating the power plant, the local paper had its math wrong. Drew Marsh, CEO of Entergy, told Callie this morning that Google is paying “the full amount” for the power generated at Cypress Solar that will go towards its data center. “There was some unfortunate math in there, but we got all that straightened out and corrected,” he said. He explained that Google’s commitment to cover the power costs is a key element of the utility’s Fair Share Plus Pledge, a framework to ensure that customers are not paying to power data centers. It’s important to note that while Google may be paying for its full incremental costs associated with the power plant, regular consumers are still paying for part of Cypress Solar. An ABC7 KATV report from late this summer revealed that Entergy bills in Arkansas increased by $5 starting in June. This new charge stemmed from the Generating Arkansas Jobs Act, which allows utilities like Entergy to charge consumers for the construction of new power plants. According to the report, about a third of this new charge was expected to go towards Cypress Solar. So why are consumers paying for the power plant that will generate electricity for a data center? Because it’s not just sending electricity to the facility, Marsh explained. “The data center is paying for part of that power plant, but that power plant is for the grid overall,” Marsh told Callie. “So our existing customers are paying for part of it.” In this case, Google is “paying their fair share of all the costs associated” with powering their operations, he said, adding that the tech giant will be paying for the majority of the construction of the power plant. Entergy has said Google will pay more than $2.1 billion over 20 years for the power generated at Cypress Solar. “For our existing customers, Arkansas is still also growing, and so they need an additional capacity as well,” Marsh said. “And that’s where their portion is coming in.”Stay tuned for the entire interview with Marsh tomorrow which will be shared to the Washington Examiner’s YouTube page. All the rest: STATES TAKE THEIR OWN ACTION ON DIESEL PRICES: A number of states have been moving ahead of the White House by taking matters into their own hands to curb record high diesel prices. State actions: In Texas, Republican Gov. Greg Abbott yesterday declared a 30-day statewide disaster, where he expanded the use of dyed-diesel, raised the allowable weight for fuel, and suspended some federal diesel emission rules. Javier Blas, an energy and commodities columnist at Bloomberg said expanding the use of dyed-diesel could save truckers in Texas about 24.4 cents per gallon in federal excise taxes, plus another 20 cents per gallon in state taxes. Republican Georgia Gov. Brian Kemp yesterday also declared a state of emergency, where he suspended the state’s fuel tax starting today and ended the state’s weight limits on commercial vehicles. The state’s current motor fuel excise tax is 33.3 cents per gallon for gasoline and 37.3 cents per gallon for diesel. The two states are following Louisiana’s lead after the state announced last week it would allow farmers and timber harvesters to use the dyed-diesel they have on hand. Dyed-diesel is typically reserved for off-road uses, such as farming, and generally exempt from federal fuel taxes. What’s the White House doing? These states’ actions come as the White House is considering a number of options to address prices. Reuters reported today that the White House is now asking the European Union to release diesel from its strategic reserves to lower global prices. “I don’t want to get ahead of anybody, but it is a fact that the Europeans have a lot of diesel reserves,” Interior Secretary Doug Burgum told reporters.Other actions that the administration is reportedly considering includes allowing for the broad sale of red dyed-diesel, asking refineries to limit diesel exports, and encouraging states to eliminate excise taxes on diesel. Read more by Maydeen here. FEDERAL REGULATORS APPROVE CONSTRUCTION OF A TENNESSEE SMR: The Nuclear Regulatory Commission announced today that it approved a construction permit for the Tennessee Valley Authority to build a small modular reactor at its Clinch River site. This is the second construction permit the NRC has approved for an SMR, as TerraPower received approval in March for a Wyoming reactor. The permit announced today, however, is the first granted to a utility. “This construction permit is more than a regulatory achievement – it’s foundational for America’s nuclear future,” Mike Skaggs, Interim President and CEO of the TVA, said. “We are proud to be part of this effort to partner with the NRC, GVH and the Administration to explore the opportunities of new nuclear as we continue to serve the Valley region and the nation.”About the project: The TVA is looking to build a 300 megawatt small modular reactor at its Clinch River Nuclear Site near Oak Ridge, Tennessee. While the permit is for only one reactor, the federally-owned utility plans to deploy as many as four reactors on site. No construction date has been announced. Before the TVA can load fuel and start operations, it will need to secure a separate operating license from the NRC. A speedy approval: The NRC said the review of the construction permit took just 14 months, four months ahead of the 18-month timeline established under Trump’s nuclear-focused executive orders signed last year. A safety evaluation for the project was completed by NRC in June of this year. PERMITTING REFORM CLOCK IS TICKING: Tomorrow is the day! After months of anticipation, the Senate is expected to release the draft text of a permitting reform bill tomorrow, Sen. Alan Armstrong told Politico today. The Oklahoma Republican confirmed that the full bill text will be released, and said there will be a press conference as well. The news comes just hours after Senate negotiators confirmed last night that they had struck a bipartisan deal. Democratic negotiators, Sens. Martin Heinrich and Sheldon Whitehouse, had been withholding their official support for the package until they were able to get more clarification on how the Trump administration would streamline permits for wind and solar projects, as well as fossil fuels. The bill is expected to include provisions that would prevent the White House, and future presidents, from pulling approvals for already-permitted energy projects. It is also expected to include measures to accelerate permits for interstate transmission lines, restrict judicial review of environmental assessments to about 150 days, and narrow when projects can be blocked under the Clean Water Act. Stay tuned for more tomorrow! SHELL MOVES FORWARD WITH CANADA LNG EXPANSION PROJECT: Shell is moving forward with a liquefied natural gas expansion project in Canada, setting the country up to become one of the top five leading global LNG exporters. A consortium led by Shell announced it has reached a final investment for Canada’s LNG project in Kitimat that would double production capacity to about 28 million metric tons per annum. Shell leads the joint venture, which includes Petronas, PetroChina, Mitsubishi Corp, and state-owned Korea Gas Corp. The LNG project is located on Canada’s Pacific coast to easily supply LNG to customers in Asia. Prime Minister Mark Carney has sought to increase gas sales to customers in Asia and Europe to reduce reliance on the U.S. amid trade tensions. ICYMI – BIG TECH TALK STATE POLICIES CONTROLLING DATA CENTER ROLL OUT: Yesterday afternoon, Callie moderated a panel with energy and public policy leads at Google, Meta, and Amazon as part of the C3 Solutions American Energy Leadership Summit. The panel discussion, which focused primarily on what these companies are doing to secure power faster for data center and AI operations, took a closer look at state efforts to manage data center growth such as large-load electric tariffs or moratoriums in Texas and New York. “The moratoriums are not helpful,” Amazon’s head of energy and environmental policy Charles Hernick said. “But I think that between conversations with governors and then senior energy officials and all these states, it’s not like the door has been slammed shut.” Hernick said the industry understands that states are responding to concerns amongst locals about the rapid pace of development. And while “moratorium” sounds “harsh,” he said companies like Amazon are eager to engage and figure out what issue each state will focus more on, such as water use, energy use, investments, or community impacts. As for what works, Dustin Carmack, director of public policy for Meta, praised Louisiana which has moved to manage data center growth through its own Ratepayer and Community Protection Framework. Carmack also pointed out that at least 25 states have approved large-load electricity tariffs, helping build mechanisms to allow for data center development without overloading the grid. “There are challenges in different regions, as we know,” he said, adding, “It is very depending on what type of market.’ RUNDOWNThe Guardian ‘It’s just cruel’: US households hit by surge in electricity shutoffs amid record hot summerHigh Country News The Forest Service is poised to hand off one of the West’s most visited landscapesForeign Policy Don’t Ban Diesel Exports