Electrical Grid Amendments

9
54-26-101
54-26-301
54-26-302
54-26-603
0
Electrical Grid Amendments
2026 GENERAL SESSION
STATE OF UTAH
Chief Sponsor: Nate Blouin
House Sponsor:
LONG TITLE
General Description:
This bill amends provisions related to large-scale electric service requirements.
Highlighted Provisions:
This bill:
defines terms;
requires large load contracts to demonstrate net positive or neutral impacts on electric
system reliability and retail customer costs;
requires large load contracts to include reciprocal benefit provisions under which large
load customers provide measurable benefits to the electric grid or retail customers;
requires large load customers to provide financial security before construction
commences;
requires large load customers to submit annual resource use reports;
modifies commission review requirements for large load contracts; and
makes technical and conforming changes.
Money Appropriated in this Bill:
None
Other Special Clauses:
None
Utah Code Sections Affected:
AMENDS:
54-26-101
, as enacted by Laws of Utah 2025, Chapter 318
54-26-301
, as enacted by Laws of Utah 2025, Chapter 318
54-26-302
, as enacted by Laws of Utah 2025, Chapter 318
ENACTS:
54-26-603
, Utah Code Annotated 1953
Be it enacted by the Legislature of the state of Utah:
Section 1. Section
54-26-101
is amended to read:
54-26-101
. Definitions.
As used in this chapter:
(1)
"Closed private generation system" means electric generating facilities and associated
transmission infrastructure that:
(a)
is not connected to and operates independently from the transmission system of a
qualified electric utility, cooperative utility, municipal utility, or other utility;
(b)
serves one or more customers with a minimum cumulative electrical demand of 100
megawatts; and
(c)
serves one or more large load customers through direct connection.
(2)
"Connected generation system" means electric generating facilities and associated
transmission infrastructure that:
(a)
is connected to and operates in conjunction with the transmission system of a
qualified electric utility;
(b)
serves one or more large load customers through connection to the transmission
system of a qualified electric utility; and
(c)
except as provided in a large load contract, operates independent of the generation
resources of any qualified electric utility, cooperative utility, municipal utility, or
other utility.
(3)
"Evaluation" means an assessment that:
(a)
evaluates the impact of a large-scale service request on a qualified electric utility's
systems;
(b)
identifies any necessary:
(i)
system modifications or upgrades to the qualified electric utility's system to
provide service as requested in a large-scale service request;
(ii)
generation capacity; or
(iii)
transmission service requests;
(c)
provides cost estimates for any required improvements; and
(d)
establishes an estimated timeline for implementing any necessary system changes.
(4)
"Large load contract" means a large load construction contract or a large load service
contract.
(5)
"Large load construction contract" means a contract for the construction of large load
facilities between:
(a)
a qualified electric utility or a large-scale generation provider; and
(b)
a large load customer.
(6)
"Large load customer" means a current or potential customer in the service territory of a
qualified electric utility that:
(a)
requests electric service under a large-scale service request; or
(b)
enters into a private generation contract with a large-scale generation provider.
(7)
"Large load customer financial security" means a financial guarantee, bond, letter of
credit, or other security instrument approved by the commission that is sufficient to
cover all large load incremental costs reasonably expected to be incurred in designing,
engineering, procuring, constructing, and completing large load facilities necessary to
serve the large load customer.
(7)
(8)
"Large load facilities" means facilities and resources reasonably necessary, as
determined in an evaluation, to provide safe and reliable electric service as requested in
a large-scale service request, including the reasonably allocated share of facilities or
upgrades necessary to facilitate a transmission request from a qualified electric utility or
large-scale generation provider necessary to serve a large-scale service request.
(8)
(9)
"Large load flexible tariff" means a tariff:
(a)
pursuant to
in accordance with
which a large load customer:
(i)
will receive components of electric services from a large-scale service provider; or
(ii)
will reduce demand at periods specified by a large-scale service provider; and
(b)
under which a large load customer receives components of available electric services
from a qualified electric utility to the extent:
(i)
the qualified electric utility's resources are reasonably expected to be available and
sufficient; and
(ii)
as determined by:
(A)
agreement with the qualified electric utility; or
(B)
tariffs approved by the commission.
(9)
(10)
"Large load incremental costs" means all costs reasonably necessary for:
(a)
the design, engineering, procurement, construction, and completion of:
(i)
large load facilities; and
(ii)
any activities required to provide electric service under a large-scale service
request; and
(b)
the long-term operation and maintenance of large load facilities for the duration of
any applicable service contract.
(11)
"Large load resource use report" means an annual report submitted by a large load
customer to the Department of Natural Resources and to the municipality or county in
which the large load customer's facilities are located that includes:
(a)
estimated annual electricity consumption and water use submitted before
commencing operations; and
(b)
actual annual electricity consumption and water use for each year of operations.
(10)
(12)
"Large load service contract" means a contract for the provision of electric
service for a large-scale service request between:
(a)
a qualified electric utility or a large-scale generation provider; and
(b)
a large load customer.
(11)
(13)
"Large-scale generation provider" means an entity that:
(a)
is not a qualified electric utility;
(b)
is registered with the commission in accordance with Section
54-26-501
; and
(c)
owns, operates, or contracts for the output of one or more qualifying generation
resources intended to be used to supply certain retail electric services to a large load
customer
pursuant to
in accordance with
a large load contract or a private generation
contract.
(12)
(14)
"Large-scale service request" means a request submitted to a qualified electric
utility for:
(a)
new electric service that is expected to reach a cumulative demand of 100 megawatts
or greater within five years of the requested initial start date; or
(b)
additional electric service that is expected to increase a customer's total service level
by 100 megawatts or greater within five years of the requested start date for the
additional service.
(13)
(15)
"Private generation contract" means a contract for the provision of electric
service through a closed private generation system between:
(a)
a large-scale generation provider; and
(b)
a large load customer requesting new electric service that is expected to reach a
cumulative demand of 100 megawatts or greater within five years of the requested
initial start date.
(14)
(16)
"Qualified electric utility" means a large-scale electric utility.
(15)
(17)
"Qualifying generation resources" means one or more electric generating
resources that, in combination:
(a)
if connected to the transmission system of a qualified electric utility:
(i)
meets or exceeds the resource adequacy standards of the qualified electric utility;
(ii)
includes sufficient resources and capacity to meet all requirements imposed by
the North American Electric Reliability Corporation and the Western Electricity
Coordinating Council; and
(iii)
is capable of satisfying the load and electricity requirements of a large load
customer without drawing on any generation or generation services provided by a
qualified electric utility, any cooperative utility, municipal utility, or other utility
except to the extent such services are provided under a large load contract; or
(b)
if not connected to the transmission system of a qualified electric utility:
(i)
is capable of satisfying the load, transmission, and electricity requirements of a
large load customer without drawing on any generation or services provided by a
qualified electric utility, any cooperative utility, municipal utility, or other utility;
and
(ii)
meets any other reliability standards established by the commission.
(18)
"Reciprocal benefits" means services, resources, or arrangements provided by a large
load customer that provide measurable benefits to the electric grid or retail customers,
including:
(a)
load flexibility or demand response capabilities;
(b)
ancillary services;
(c)
energy storage available for grid support;
(d)
generation capable of providing power to the grid during emergencies;
(e)
environmental benefits including operation as a non-emitting facility, emissions
reductions, or compliance with environmental standards that exceed regulatory
requirements;
(f)
discounted sale of excess electricity to utilities;
(g)
financial contributions toward infrastructure improvements; or
(h)
other arrangements approved by the commission.
(16)
(19)
"Transmission provider" means an entity that:
(a)
is an affiliate of a qualified electric utility; and
(b)
(i)
owns, operates, or controls facilities located in the state that are used for the
transmission of electric energy at voltages above 100 kilovolts; or
(ii)
provides transmission service under a Federal Energy Regulatory
Commission-approved open access transmission tariff.
Section 2. Section
54-26-301
is amended to read:
54-26-301
. Large load contract requirements.
(1)
Electric service for a large-scale service request shall be provided only under one or
more large load contracts with:
(a)
a qualified electric utility;
(b)
a large-scale generation provider; or
(c)
any combination of Subsections
(1)(a)
and
(1)(b)
.
(2)
A large load customer shall:
(a)
contract for all of the customer's projected electrical requirements under the
large-scale service request; and
(b)
maintain contracts with resources or load shedding capabilities sufficient to meet the
customer's actual electrical requirements at all times.
(3)
A large load contract with a qualified electric utility shall:
(a)
ensure that all large load incremental costs are allocated to and paid by the large load
customer;
(b)
comply with all system requirements;
(c)
require the large load customer to maintain financial security sufficient to cover the
large load customer's obligations;
(d)
specify:
(i)
points of interconnection;
(ii)
power delivery points;
(iii)
the amount of electrical capacity contracted for;
(iv)
the term of service; and
(v)
any arrangements for backup power supply;
(e)
provide curtailment provisions if the large load customer's demand exceeds the
amount of contractually supported demand;
(f)
identify the incremental generation resources that the qualified electric utility will use
to serve the large load customer;
and
(g)
include provisions addressing the allocation and payment of long-term operation and
maintenance costs for large load facilities
.
;
(h)
demonstrate that serving the large load customer will have a net positive or neutral
impact on:
(i)
electric system reliability;
(ii)
costs to retail customers; and
(iii)
the environment;
(i)
include reciprocal benefit provisions under which the large load customer provides
reciprocal benefits proportionate to:
(i)
the customer's use of transmission or distribution infrastructure;
(ii)
infrastructure investments required to serve the customer; and
(iii)
reliability risks or costs imposed on retail customers; and
(j)
require the large load customer to provide large load customer financial security
before the qualified electric utility commences design and construction of large load
facilities.
(4)
A large load contract with a large-scale generation provider that provides service
through a connected electrical system shall:
(a)
ensure that all large load incremental costs are allocated to and paid by the large load
customer;
(b)
comply with all system requirements;
(c)
specify:
(i)
points of interconnection;
(ii)
power delivery points;
(iii)
the amount of electrical capacity contracted for;
(iv)
the term of service; and
(v)
any arrangements for backup power supply; and
(d)
provide curtailment provisions if the large load customer's demand exceeds the
real-time dispatch of the large-scale generation provider's resources under the large
load contract, net of transmission losses.
(5)
A qualified electric utility:
(a)
has no duty to serve a large load customer except as explicitly provided in a large
load contract; and
(b)
is not required to provide backup power to a large load customer except as explicitly
provided in a large load contract.
(6)
A qualified electric utility may not be required to commence design and construction of
large load facilities until after:
(a)
executing a large load construction contract; and
(b)
obtaining commission approval in accordance with Section
54-26-302
.
(7)
A qualified electric utility or large-scale generation provider shall:
(a)
obtain commission approval in accordance with Section
54-26-302
before providing
electric service under a large load contract; and
(b)
negotiate the terms of a large load contract with a large load customer on a
case-by-case basis.
(8)
Within 15 business days after executing a large load contract, a person executing the
contract shall submit an application for approval to the commission for review under
Section
54-26-302
.
Section 3. Section
54-26-302
is amended to read:
54-26-302
. Commission review -- Approval of contracts.
(1)
A qualified electric utility or a large-scale generation provider shall file an application
with the commission for approval of a large load contract that includes:
(a)
a copy of the large load contract for which the applicant seeks review and approval;
and
(b)
evidence sufficient to demonstrate compliance with
Subsection
(2)(b)
Subsections
(2)(b)
, (d), and (e)
.
(2)
The commission shall approve a large load contract submitted under Subsection
(1)
if
the commission finds by a preponderance of the evidence that:
(a)
the contract complies with the requirements of this chapter;
(b)
the large load customer bears all just and reasonable incremental costs attributable to
receiving the requested electric service;
and
(c)
existing ratepayers do not bear costs justly and reasonably attributable to providing
electric service for the large load customer
.
;
(d)
the large load customer will provide reciprocal benefits that will have a net positive
or neutral impact on electric system reliability and costs to retail customers; and
(e)
the large load contract demonstrates that serving the large load customer will have a
net positive or neutral impact on the environment.
(3)
Commission review of a large load contract:
(a)
is limited to the requirements described in Subsection
(2)
; and
(b)
does not include review of other contract terms.
(4)
The commission shall approve or disapprove an application submitted under this section
within 60 days after the day on which a person files the application.
(5)
The commission may establish rules to expedite the review of applications for approval
of a large load contract under this chapter.
Section 4. Section
54-26-603
is enacted to read:
54-26-603
. Large load customer reporting requirements.
(1)
A large load customer shall submit a large load resource use report:
(a)
annually to the Department of Natural Resources; and
(b)
annually to the municipality or county in which the large load customer's facilities
are located.
(2)
A large load customer shall submit the initial large load resource use report:
(a)
before commencing operations; and
(b)
including estimates of annual electricity consumption and water use.
(3)
After commencing operations, a large load customer shall submit a large load resource
use report annually that includes actual electricity consumption and water use for the
preceding year.
Section 5.
Effective Date.
This bill takes effect on
May 6, 2026
.
2-10-26 12:34 PM