Power Bill Protection/Large Load Tariff.

GENERAL ASSEMBLY OF NORTH CAROLINA
SESSION 2025
S 1
SENATE BILL 1026

Short Title: Power Bill Protection/Large Load Tariff. (Public)
Sponsors: Senators Salvador and Grafstein (Primary Sponsors).
Referred to: Rules and Operations of the Senate
May 4, 2026
*S1026-v-1*
A BILL TO BE ENTITLED 1
AN ACT TO REFORM NOR TH CAROLINA'S APPROA CH TO INTEGRATION OF 2
LARGE-LOAD ELECTRICI TY CUSTOMERS THROUGH AMENDMENT OF THE 3
PUBLIC UTILITIES ACT. 4
The General Assembly of North Carolina enacts: 5
6
LARGE-LOAD ELECTRICITY CUSTOMERS 7
SECTION 1.(a) G.S. 62-3 reads as rewritten: 8
"§ 62-3. Definitions. 9
As used in this Chapter, unless the context otherwise requires, the term: 10
… 11
(16a) "Large-load customer" means a nonresidential customer for retail electric 12
service who has an actual or projected peak demand equal to or greater than 13
50 megawatts (MW). For a nonresidential customer who operates facilities 14
located at multiple sites, the aggregate demand of the nonresidential customer 15
across multiple sites shall be used for purposes of determining the 16
applicability of any threshold, requirement, or limitation in this Chapter. 17
(16a)(16b) "Local exchange company" means a person holding, on January 1, 1995, 18
a certificate to provide local exchange services or exchange access services. 19
… 20
(19a) "Panel" means a panel of three commissioners, a division of the Utilities 21
Commission authorized for the purpose of carrying out certain functions of 22
the Commission. 23
… 24
(30) "Panel" means a panel of three commissioners, a division of the Utilities 25
Commission authorized for the purpose of carrying out certain functions of 26
the Commission. 27
(31) Very large -load customer. – A large -load customer who has an actual or 28
projected peak demand equal or greater than 100 megawatts (MW)." 29
SECTION 1.(b) G.S. 62-133.5(h)(1)a. reads as rewritten: 30
"a. Local exchange company. – The same meaning as provided in 31
G.S. 62-3(16a).G.S. 62-3(16b)." 32
SECTION 2.(a) Chapter 62 of the General Statutes is amended by adding a new 33
Article to read: 34
"Article 6C. 35
"Large-Load Electricity Customers. 36
General Assembly Of North Carolina Session 2025
Page 2 Senate Bill 1026-First Edition
"§ 62-127.1. Electric service tariffs for large-load customers. 1
(a) Application. – Each electric public utility shall file for approval by the Commission 2
tariffs for the provision of electric service to large -load customers. Subject to the limitations set 3
forth in this section, the Commission may approve a tiered tariff schedule that includes different 4
rates, terms, and conditions for different classes of large -load customers based on load 5
requirements or other factors related to the cost of service. 6
(b) General Terms and Conditions. – The Commission shall require an electric public 7
utility to incorporate the following terms and conditions in any tariff applicable to large-load 8
customers: 9
(1) A minimum contract term that obligates a large -load customer to receive 10
service for a term of no less than twenty years. 11
(2) A minimum billing demand requirement that obligates a large load customer 12
to take or pay for a certain percentage of the customer's maximum contracted 13
demand following commencement of service. 14
(3) A contribution in aid of construction mechanism that requires large -load 15
customers, prior to receiving initial service, to pay the electric public utility 16
the entire cost of any transmission, distribution, or intercon nection 17
improvements attributable to serving that customer. 18
(4) An authorization on behalf of the large -load customer granting the electric 19
public utility sufficient access to review any relevant commercial agreement 20
or other confidential business information for the purpose of verifying the 21
feasibility of the customer 's projected load requirement prior to mak ing the 22
infrastructure improvements necessary to serve the customer. 23
(5) A reasonable credit or financial assurance requirement sufficient to protect 24
other ratepayers against any material increase in rates that could occur as a 25
result of a large-load customer either ceasing operations or taking less than 26
the contracted demand for electric service. 27
(6) A load ramp period, not to exceed four years, during which time the large-load 28
customer increases its electricity usage in accordance with a defined schedule 29
until authorized to receive its maximum contracted demand. 30
(7) A req uirement that a large -load customer give the electric public utility 31
advanced notice prior to any anticipated reduction in its demand for electric 32
service. 33
(8) An exit fee or similar mechanism that allows an electric public utility to 34
recover from a large -load customer an y forgone revenue as a result of the 35
large-load customer's (i) early termination of the electric service agreement, 36
(ii) failure to maintain contracted electric load, or (iii) abandonment or 37
downsizing of facilities receiving electric service. 38
(9) Any other provision that the Commission determines to be reasonable and in 39
the public interest. 40
(c) Specific Eligibility Conditions for Very Large-Load Customers. – The Commission 41
shall require that an electric public utility limit which very large -load customers can receive 42
electric service under a tariff filed in accordance with this section to those very large -load 43
customers who either (i) procure dedicated or incremental energy resources under the program 44
established in G.S. 62-127.2, or (ii) participate in a Commission-approved mechanism to mitigate 45
system cost impacts. 46
(d) Commission Approval. – The Commission shall approve a proposed electric service 47
tariff for large -load customers only upon finding that the tariff is just and reasonable, and 48
sufficiently designed to ensure all of the following: 49
(1) That the proposed rates are based on the cost causation principle, as defined 50
in G.S. 62-133.16, and that large -load customers will be responsible for the 51
General Assembly Of North Carolina Session 2025
Senate Bill 1026-First Edition Page 3
entire cost of any capital investments or incremental operational expenses 1
necessary for the electric public utility to serve large -load customers, 2
including any transmission, distribution, or interconnection costs reasonably 3
attributable to serving large-load customers. 4
(2) That the proposed rates will not result in the electric public utility's other retail 5
customers who are classified as residential or small commercial customers 6
having to cross-subsidize large-load customers. 7
(3) That the electric public utility 's other retail customers who are classified as 8
residential or small commercial customers will be held harmless, and neither 9
advantaged nor disadvantaged, from large-load customers either commencing 10
service or discontinuing service under the proposed tariff. 11
(4) That the proposed tariff incorporates to the satisfaction of the Commission all 12
terms and conditions required under subsections (b) and (c) of this section. 13
(5) That the proposed tariff complies with any other rule or order adopted by the 14
Commission pursuant to this Article. 15
"§ 62-127.2. Dedicated or incremental energy supply for large-load customers. 16
(a) Definitions. – For purposes of this section, the terms "clean energy facility" and "clean 17
energy resource" have the same meaning as provided in G.S. 62-133.8. 18
(b) Application. – Each electric public utility shall file with the Commission an 19
application requesting approval of a program to allow large-load customers to select clean energy 20
facilities from which the electric public utility will procure energy and capacity on behalf of the 21
large-load customer. Each application shall provide standard contract terms and conditions for 22
participating large-load customers and for the suppliers of clean energy resources from which the 23
electric public utility procures energy and capacity on behalf of the participating customer. The 24
standard terms and conditions available to suppliers of clean energy resources shall provide a 25
range of terms from which the participating customer may elect. Large -load customers shall be 26
allowed to negotiate with suppliers of clean energy resources regarding price terms. 27
(c) Limitations. – Each contracted amount of capacity shall be limited to no more than 28
one hundred twenty-five percent (125%) of the maximum annual peak demand of the large-load 29
customer's facilities. The electric public utility shall establish such requirements consistent with 30
G.S. 62-127.1(b) to protect other ratepayers against any material increase in rates that could occur 31
as a result of the large-load customer either ceasing operations or breaching any contractual 32
obligations made in accordance with the program. 33
(d) Cost Recovery; Bill Credits. – In addition to the large -load customer's normal retail 34
bill, the total cost of any clean energy resources and capacity procured by the electric public 35
utility for the benefit of the large-load customer shall be paid by that customer. The electric public 36
utility shall pay the owner of the clean energy facility which provided the electricity. The 37
participating large -load customer shall receive a bill credit for the energy in an amount 38
determined by the Commission, not to exceed the utility 's avoided cost. The Commission shall 39
ensure that all other ratepayers are held neutral, neither advantaged nor disadvantaged, from the 40
impact of the clean energy resources procured on behalf of the large-load customer. 41
"§ 62-127.3. Rules. 42
Pursuant to G.S. 62-31, the Commission shall adopt rules to implement the requirements of 43
this Article. These rules shall include specific procedures and requirements for very large -load 44
customers to demonstrate eligibility , in accordance with G.S. 62-127.1(c), to receive service 45
under an electric service tariff for large-load customers by mitigating system cost impacts." 46
SECTION 2.(b) The tariff application required to be filed with the Utilities 47
Commission pursuant to G.S. 62-127.1, as enacted by subsection (a) of this section, shall be filed 48
by the electric public utility no later than 180 days after the effective date of this section. Effective 49
January 1, 2028, an electric public utility shall not provide electric service to a large -load 50
General Assembly Of North Carolina Session 2025
Page 4 Senate Bill 1026-First Edition
customer except under the terms of a tariff approved by the Utilities Commission in accordance 1
with G.S. 62-127.1. 2
SECTION 2.(c) The application required to be filed with the Utilities Commission 3
pursuant to G.S. 62-127.2, as enacted by subsection (a) of this section, shall be filed by the 4
electric public utility no later than 180 days after the effective date of this section. 5
SECTION 2.(d) This section is effective when it becomes law. 6
7
STANDBY ELECTRICITY SERVICE 8
SECTION 3. The Utilities Commission shall evaluate and modify as necessary 9
existing standby service charges, including any eligibility limits based on maximum electricity 10
demands, for the purpose of enabling large -load customers to self -develop dedicated or 11
incremental generation resources in order to meet their electricity needs through self-supply. 12
13
SURCHARGE ON LARGE-LOAD CUSTOMERS TO FUND GRID MODERNIZATION 14
PROJECTS 15
SECTION 4. Article 7 of Chapter 62 of the General Statutes is amended by adding 16
a new section to read: 17
"§ 62-157.1. Grid modernization projects fund; large-load customer surcharge. 18
(a) Findings. – The General Assembly finds that substantial investments in electric 19
generation and transmission infrastructure will be required to meet the growing demand for 20
electric power in the North Carolina, which is primarily attributable to the proliferati on of new 21
data centers and other large -load facilities locating in the State. These investments have been 22
made at significant cost to the electric public utilities, which ultimately recover these costs from 23
other utility customers in the form of higher retail rates. The General Assembly finds it to b e in 24
the public interest to establish a surcharge on the purchases of electric power by large -load 25
customers to be used to fund grid modernization projects to reduce system-wide costs and to 26
mitigate the disproportionate impact that higher electric rates have on other retail customers in 27
the State. 28
(b) Grid Modernization Projects Fund.– In order to mitigate the impact of higher electric 29
rates faced by residents of the State, the Commission shall, after a hearing, order an electric public 30
utility to create a special fund to be used by that utility to implement grid modernization projects 31
for the purpose of reducing the system -wide costs incurred as a result of serving the growing 32
electricity demands of large-load customers. The fund shall be supervised and administered by 33
the Commission. Any applicable taxes shall be paid out of the fund. 34
(c) Eligible Projects. – Pursuant to an order of the Commission, the electric public utility 35
may apply funds to grid modernization projects that are designed to reduce low-income energy 36
burdens and to encourage peak load reduction, energy efficiency, demand response measures, 37
and distributed energy resources, including virtual power plants. The Commission shall ensure 38
that all projects to which the grid modernization projects funds are applied are consi stent with 39
the intent of this section and G.S. 62-110.9. 40
(d) Authority to Require Surcharge. – The Commission shall require electric public 41
utilities to assess a surcharge on the purchases of electric power by large-load customers to fund 42
grid modernization projects. Upon petition by an electric public utility, and afte r giving notice 43
and an opportunity for other interested parties to be heard, the Commission shall set a monthly 44
surcharge on electricity consumption by large-load customers, assessed on a kilowatt-hour (kWh) 45
basis, at a rate that generates sufficient revenue to offset the incremental costs attributable to 46
serving large-load customers. 47
(e) Adjustment Proceedings. – The Commission may, on its own motion or upon petition 48
of an electric public utility or interested party, conduct a hearing to review an electric public 49
utility's implementation of grid modernization projects and the surcharge on electricity purchased 50
by large-load customers. The Commission may, after giving notice and an opportunity for other 51
General Assembly Of North Carolina Session 2025
Senate Bill 1026-First Edition Page 5
parties to be heard, approve a revision to the surcharge or make other appropriate adjustments to 1
the administration of the grid modernization projects fund. 2
(f) Annual Report. – An electric public utility shall submit a report each year to the 3
Utilities Commission and the State Energy Office that includes aggregated data on the amount 4
of funds collected by the surcharge on purchases of electric power by large-load customers, the 5
amount of funds expended on grid modernization projects, the number and types of grid 6
modernization projects implemented, and the estimated average reduction in retail electric utility 7
bills as a result of the grid modernization projects carried out in accordance with this section." 8
9
GRID MODERNIZATION PLANNING 10
SECTION 5.(a) Article 5A of Chapter 62 of the General Statutes is amended by 11
adding a new section to read: 12
"§ 62-108. Grid modernization plan. 13
(a) The Commission shall develop, publicize, and keep current a grid modernization plan 14
to maintain and improve the adequacy, reliability, and resiliency of the electric grid for the benefit 15
of the people of North Carolina. In developing the grid modernization plan, the Commission shall 16
assess the capability of the grid system to withstand and recover from climate-induced natural 17
disasters and other significant multi -hazard threats with minimal resulting damage or loss of 18
operability. The Commission shall propose measures informed by this assessment that are 19
designed to improve the efficiency of the grid system, reduce energy losses, enable flexible load 20
management, and lower long -term system costs. The Commission shall consider the grid 21
modernization plan in acting upon any petition by an applicant for a certificate to construct a new 22
transmission line. 23
(b) In the course of developing the grid modernization plan, the Commission shall consult 24
with electric power suppliers, the Public Staff, and other interested parties. The Commission shall 25
also provide opportunities for public hearings on the proposals set forth in the grid modernization 26
plan. 27
(c) No later than April 1 of each year, the Commission shall submit a report on the 28
activities taken by the Commission to develop, and by electric public utilities to implement, the 29
grid modernization plan to the Governor, the Environmental Review Commission, the Joint 30
Legislative Commission on Energy Policy, and the Joint Legislative Oversight Committee on 31
Agriculture and Natural and Economic Resources. The report shall include a summary of public 32
comments received by the Commission." 33
SECTION 5.(b) G.S. 62-102(a) reads as rewritten: 34
"§ 62-102. Application for certificate. 35
(a) An applicant for the certificate described in G.S. 62-101 shall file an application with 36
the Commission containing the following information: 37
(1) The reasons the transmission line is needed; 38
(2) A description of the proposed location of the transmission line; 39
(3) A description of the proposed transmission line; 40
(4) An environmental report setting forth: 41
a. The environmental impact of the proposed action; 42
b. Any proposed mitigating measures that may minimize the 43
environmental impact; and 44
c. Alternatives to the proposed action. 45
(4a) A statement on the project 's consistency with the Commission 's grid 46
modernization plan, as provided in G.S. 62-108. 47
(5) A list of all necessary approvals that the applicant must obtain before it may 48
begin to construct the transmission line; and 49
(6) Any other information the Commission requires." 50
SECTION 5.(c) G.S. 62-105 reads as rewritten: 51
General Assembly Of North Carolina Session 2025
Page 6 Senate Bill 1026-First Edition
"§ 62-105. Burden of proof; decision. 1
(a) The burden of proof is on the applicant in all cases under this Article, except that any 2
party proposing an alternative location for the proposed transmission line shall have the burden 3
of proof in sustaining its position. The Commission may consider any factors that it finds ar e 4
relevant and material to its decision. The Commission shall grant a certificate for the 5
construction, operation, and maintenance of the proposed transmission line if it finds: upon 6
finding each of the following: 7
(1) That the proposed transmission line is necessary to satisfy the reasonable 8
needs of the public for an adequate and reliable supply of electric 9
energy;energy. 10
(2) That, when compared with reasonable alternative courses of action, 11
construction of the transmission line in the proposed location is reasonable, 12
preferred, and in the public interest;interest. 13
(3) That the costs associated with the proposed transmission li ne are 14
reasonable;reasonable. 15
(4) That the impact the proposed transmission line will have on the environment 16
is justified considering the state of available technology, the nature and 17
economics of the various alternatives, and other material considerations; 18
andconsiderations. 19
(4a) That the proposed transmission line is consistent with the grid modernization 20
plan developed by the Commission under G.S. 62-108. 21
(5) That the environmental compatibility, public convenience, and necessity 22
require the transmission line. 23
(b) If the Commission determines that the location of the proposed transmission line 24
should be modified, it may condition its certificate upon modifications it finds necessary to make 25
the findings and determinations set forth in subsection (a) of this section." 26
27
LOAD FORECASTING FOR NEW ELECTRIC GENERATING FACILITIES 28
SECTION 6. G.S. 62-110.1 is amended by adding a new subsection to read: 29
"(d1) In acting on a petition by an electric public uti lity for the construction of an electric 30
generating facility to serve future growth in electricity demand attributable to new large -load 31
customers, the Commission shall require the applicant to demonstrate the reasonableness of such 32
future growth projections by distinguishing between confirmed and speculative sources of new 33
electricity demand, and by filing with the Commission any agreements between the utility and 34
its large-load customers obligating the cus tomers to receive electric services. The Commission 35
shall not grant a certificate for the construction of an electric generating facility to meet demand 36
attributable to new large-load customers unless the applicant demonstrates that its future demand 37
growth projections are reasonable and supported by competent evidence." 38
39
LARGE-LOAD CUSTOMER ENERGY AND WATER REPORTING 40
SECTION 7.(a) Article 17 of Chapter 62 of the General Statutes is amended by 41
adding a new section to read: 42
"§ 62-353. Large-load customers; annual reporting on energy and water consumption. 43
(a) Annual Report. – Each large -load customer shall file an annual report to the 44
Commission and the Department of Environmental Quality that provides the following 45
information about the operation of its facilities during the prior year: 46
(1) The total amount of electricity consumed. 47
(2) The maximum annual peak demand, as defined in G.S. 62-126.3. 48
(3) The load factor, as calculated based on the total electricity consumed relative 49
to the maximum annual peak demand. 50
(4) The total amount of water consumed. 51
General Assembly Of North Carolina Session 2025
Senate Bill 1026-First Edition Page 7
(5) The source of the customer's water supplies. 1
(6) A description of the cooling methods used in the customer 's facilities, 2
including available data indicating the efficiency of the cooling methods used. 3
(7) Any additional information requested by the Commission or the Department 4
of Environmental Quality to inform planning related to the State's electricity 5
and water supply needs. 6
(b) Statistical Compilation – The Commission, in consultat ion with the Departme nt of 7
Environmental Quality, shall compile statistical information on the aggregate amounts of energy 8
and water consum ed by large-load c ustomers. The Commission shall publish this statistical 9
compilation on its website each year, provided that the annual reports filed by the large -load 10
customers in accordance with subsection (a) of this section shall not be considered public records 11
within the meaning of Chapter 132 of the General Statutes but shall remain confidential." 12
SECTION 7.(b) G.S. 143-355(b) is amended by adding a new subdivision to read: 13
"(18) Cooperate with the Utilities Commission in evaluating the water usage of 14
large-load customers, as defined in G.S. 62-3, and any resulting impacts to the 15
availability of water supply. In carrying out this evaluation, the Department 16
shall coordinate with units of local government and any other agency or 17
organization concerned with the conservation and development of water 18
resources." 19
20
APPROPRIATION 21
SECTION 8. There is appropriated from the General Fund to the Utilities 22
Commission the sum of ten thousand dollars ($10,000) in nonrecurring funds for the 2026-2027 23
fiscal year to be used for purposes consistent with this act. 24
25
EFFECTIVE DATE 26
SECTION 9. Except as otherwise provided, this act becomes effective July 1, 2026. 27