September 21, 2026

Deconstructing Data Centers: BYONCE, The Clean Energy Fix

Deconstructing Data Centers breaks down the often complex legal, energy, regulatory, and political issues associated with data centers.

By Tom McFeeley, Media Relations Specialist

Data center construction continues to surge across the Midwest and the country. ELPC advocates for common-sense guardrails that protect ratepayers and the environment amid that growth. This series, Deconstructing Data Centers, breaks down the often complex legal, energy, regulatory, and political issues associated with data centers.

We began the Deconstructing Data Centers series with a look at why data centers are multiplying so fast, and why that growth can quietly show up on your electricity bill even if you never see one built near you. This post looks at the fix the Environmental Law & Policy Center is fighting for: making sure the companies building data centers bring their own new clean power instead of leaning on the grid the rest of us already depend on.

WHO PAYS TO POWER DATA CENTERS?

Modern data centers use a lot of electricity. Take for example the 1-gigawatt data center that Google has proposed in southeast Michigan. That one data center alone would need as much power as every home in the city of Detroit.

Meeting that immense power demand isn’t a simple matter of hooking the new data center up to the grid and flipping the on switch. Instead, a local utility needs to build new power plants, transmission lines, and substations to make sure electricity demand does not exceed supply.

And who pays for those new power plants? Right now, in most places, the answer is “everyone.” Under current rules in most states, the costs of those new plants often get spread across every ratepayer, not just the company that created the need for them. That kind of cost sharing made sense when new additions to the grid were small: one house, a grocery store, or a coffee shop isn’t going to need an entire power plant for itself. But with data centers that use as much power as entire cities driving higher prices for everyone, we need a new approach.

THE FIX: BRING YOUR OWN NEW CLEAN ENERGY

ELPC calls this fix BYONCE, short for “bring your own new clean energy.” The idea is simple: if a company wants to build a data center that uses a huge amount of electricity, it should bring a real portfolio of new clean resources, like wind, solar, battery storage, demand response, and energy efficiency, to match that new demand. Not old credits from a wind farm that was already running. Actual new supply, sized to cover the data center’s full power needs.

That portfolio matters because the math doesn’t work otherwise. It would be extremely difficult, and expensive, to power a single 1-gigawatt data center with new wind and solar alone, since neither one runs around the clock. Load flexibility, demand response, energy efficiency, and battery storage fill the gaps new renewables can’t. Aggregations of distributed resources like two-way electric vehicle chargers that feed power back into the grid a few hours a day can also be a part of the portfolio. Each one of these solutions creates real “clean capacity,” power, or reduced demand, that the grid can count on exactly when it’s needed, without adding another fossil fuel plant to the mix.

That “new” part matters more than it might sound. Buying clean energy credits from an existing project doesn’t add any electricity to the grid, it just relabels power that already existed and pushes up prices for everyone. BYONCE closes that loophole by requiring the clean energy to be genuinely additional, which means it actually offsets the strain a data center puts on the grid instead of just offsetting it on paper.

THE RISK OF BUILDING FOR A BOOM THAT DOESN’T LAST

There’s also a straightforward math problem with the alternative. If utilities respond to data center demand by building a wave of new gas plants, the public inherits the risk if that demand doesn’t show up the way developers promised. Gas plants run for 40 to 50 years, but the AI investment boom driving today’s data center demand could look very different in five. If a project gets scaled back, a company goes under, or the technology ends up needing less power than today’s projections assume, ratepayers and the government are typically the ones left covering the cost of plants nobody needs anymore. Utilities already have a track record of over-forecasting demand growth, and one recent analysis found that data center load projections carry an unusually wide range of uncertainty right now.

BYONCE sidesteps that bet. Building clean, flexible capacity in smaller increments, demand response contracts, efficiency upgrades, batteries, and new renewables, spreads the risk out and scales it to what’s actually needed. If a data center project doesn’t pan out the way its developer hoped, the public isn’t left holding a half-century mortgage on a gas plant it never needed.

WHY CLEAN, SPECIFICALLY?

As described above, clean resources are cheaper and less risky than the massive gas buildout that many data center companies are pushing for. Gas is a highly volatile commodity and a massive increase in grid-connected gas will drive electricity prices up for everyone. Clean resources don’t have fuel costs and won’t lead to unexpected price hikes down the road.

And that’s not the only reason BYONCE needs to be clean.

Until recently, the tech companies driving the data center boom recognized the threat that air pollution and greenhouse gas emissions pose to human health. In 2020, for example, Microsoft pledged to be “carbon negative by 2030,” noting that the “scientific consensus is clear.”

The tech companies’ business model may have changed, but the science hasn’t. We need to rapidly reduce our emissions to stabilize our climate and prevent what Microsoft itself once saw as “catastrophic” consequences. Similarly, research has repeatedly shown that air pollution from fossil fuel power plants has serious negative health impacts on nearby communities.

The companies building data centers are among the richest in the world. They should be part of the solution to climate change and air pollution, not part of the problem.

WHAT THIS LOOKS LIKE IN ILLINOIS

This isn’t a theoretical idea. In Illinois, ELPC and a coalition of environmental and consumer groups pushed for the POWER Act (SB4016/HB5513) this year, legislation that would have written a version of this requirement into state law, along with faster grid connections for data centers that lead on clean energy, and stronger transparency rules around water and energy use. The bill didn’t cross the finish line before the spring session ended, but the fight isn’t over. Illinois lawmakers will get another chance to take it up during this fall’s veto session.

It’s worth contrasting this with what’s being offered at the federal level. The Trump administration has floated a voluntary “Ratepayer Protection Pledge,” encouraging data center developers to bring their own power. But it’s just that: voluntary, with no requirement that the power be clean, and no enforcement mechanism if a company simply doesn’t follow through. BYONCE, by contrast, would be a legal requirement, not a suggestion, and one that specifically closes the clean energy loophole the federal pledge leaves wide open.

WHAT THIS SERIES WILL EXPLORE NEXT

Understanding the “who pays and with what power” problem is only part of the picture. We will soon look at the local environmental toll data centers can bring, especially to air and water, and why the choice between clean energy and fossil-fueled backup power isn’t just about your electric bill. It’s about what’s happening in the air and water of the communities living closest to these buildings.

Because here’s the thing about BYONCE: it doesn’t just protect your wallet. Clean energy doesn’t burn diesel. It doesn’t need cooling water pulled from a nearby river. When we ask data centers to bring new clean power, we’re not just solving a cost problem, we’re heading off the environmental one before it starts. That’s exactly where we’re headed next.