The Upsides and Downsides of Senator Cotton’s DATA Act

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The DATA Act offers short-term relief from policy-driven energy costs, but could weaken grid efficiency and raise long-term costs for consumers. 

It is no secret that years of perverse federal and state policies promoting wind and solar electricity as replacements for natural gas- and coal-fired power have yielded large increases in costs and decreases in reliability. That is why, for example, California has the nation’s highest rates and a serious reliability problem. For wind and solar power, the two main drivers of higher costs are the costs of backup power (from natural gas turbines) to avoid service interruptions, and the costs of much-longer transmission systems. 

Such policy-driven costs—the result of ideological imperatives and interest-group pressures—provide no additional value to consumers of electric power. Furthermore, permitting delays for power plants and transmission systems are so large as to represent a serious threat to the nation’s power infrastructure, a state of affairs that cries out for Congressional actionyielding faster and more predictable paths for infrastructure investment and integration. And for large consumers of power, the increasing risk of service interruptions raises the possibility of some form of rationing, which inevitably would be driven by political pressures.

Grid Exit and Self-Generation Trends 

Accordingly, it can surprise no one that large demanders that can avoid such costs by exiting the larger grid system are availing themselves of that opportunity. This is the case particularly for data centers, which are increasingly installing their own generation capacity on their sites. Over the longer term,........

© The National Interest