Alliant Energy Proposes Special Electric Rates for Meta’s Data Center

Alliant Energy is asking state regulators to approve custom electric rates for Meta’s large data center campus in Beaver Dam, but the heavily redacted document hides details from the public, including the amount of energy the project is expected to use.

The utility argues the proposal would bring millions of dollars in investment and shield other customers from higher costs. But critics argue it poses risks to Alliant’s other customers who could end up subsidizing the tech giant.

Alliant isn’t the only utility company eying special rates for data centers. Regulators held public hearings on Tuesday on a data center rate proposal from We Energies. And Xcel Energy plans to apply for special large customer rates that would apply to data centers in Wisconsin and three other states.

Alliant Energy filed an application with the Public Service Commission of Wisconsin last year for an Individual Contract Rate Agreement for the Beaver Dam data center. Alliant’s application, filed in April 2025, doesn’t explicitly name Meta. The social media giant didn’t publicly announce it was behind the data center project until November.

Under the agreement, Alliant will charge the tech company “reasonable, cost-based rates that recover the costs” of providing service to the data center, according to the application.

The agreement also includes terms and conditions “designed to protect” the utility and its other customers while allowing the data center to increase its electric usage over time, the application states. Meta would also “make payments to offset system costs regardless of the amount of” energy that it ends up needing, the filing said.

At the end of the agreement’s term, Alliant and Meta could renegotiate electric rates or Meta could transition to a standard rate approved by the PSC, the application says.

The agreement would also require termination payments if Meta cancels the project at any time during the agreement’s term, the filing states.

In its application, Alliant also said the agreement “will not harm other customers.” An Alliant Energy spokesperson said via email the proposed contract rates are intended to protect current customers from energy cost increases.

“Individual Contract Rates provide Alliant Energy the opportunity to ensure there are benefits to all customers when adding a customer of this size to our energy system, while also ensuring the costs are paid by that customer specifically,” the spokesperson said. “In our future rate filings, the PSC will be able to determine with certainty that data centers are paying all costs to serve them.”

Redactions, one-off rates for Meta project raise alarm from critics

But the application redacts multiple details from Alliant’s proposed rate agreement, including Meta’s energy demand, the contract term length and termination payment calculations.

In December, an environmental group sued the Public Service Commission to try to force the release of Meta’s expected energy demand. That legal battle is still ongoing.

Tom Content, executive director of the Citizens Utility Board of Wisconsin, said some interest groups in the case have signed confidentiality agreements to evaluate the proposal without redactions.

But he said the redactions in Alliant’s application make it hard for the general public to evaluate the company’s claims that the proposal will protect customers.

“It’s hard to know what’s going on here as an average citizen,” Content said. “I think it’s important that more of this be done in the sunshine.”

He also said there aren’t enough details provided to demonstrate that Meta will fully cover its costs.  Content argues the contract terms are too short and the early exit fees need to be strengthened to better protect customers.

Content said Alliant should’ve applied a standard data center rate framework that’s consistent for all potential data centers in their service territory instead of offering a custom rate for the Beaver Dam project.

Environmental groups, Sierra Club and Clean Wisconsin, also shared similar concerns about the individual customer rate in their testimony.

“(Alliant)’s hastiness in asking the Commission to approve one-off rate agreements clearly provides an economic benefit to (Alliant)’s shareholders, but it creates a longer-term risk for (Alliant)’s ratepayers,” wrote Priyam Desai, a staff attorney for the Sierra Club.

In testimony filed with the PSC on behalf of the Wisconsin Industrial Energy Group, energy advisor Jeffry Pollock also said there’s a “non-zero risk” that Alliant’s existing customers “could subsidize” Meta at some point over the life of the rate agreement.

Public hearings in Alliant Energy’s data center rate case are scheduled for Feb. 24.

We Energies data center rates get public hearing

At the same time, We Energies is seeking approval for a rate plan that would apply to all data center-scale customers in its service territory.

We Energies has said its plan would prevent customers from paying additional costs related to data centers, while critics have argued it could lead to higher costs without additional safeguards.

On Tuesday, We Energies spokesperson Brendan Conway told WPR’s “Wisconsin Today” that the company does not support shifting costs from data centers to its other customers and that its rate plan has received buy-in from both Microsoft and OpenAI, companies developing data centers in southeast Wisconsin.

“This proposal is focused on making sure there is no cost shift from data centers to customers,” he said.

But at a public hearing later in the day, people who live in the service area raised concerns about the proposal.

Some worried the proposal would leave customers on the hook for infrastructure costs related to powering data centers, while others felt We Energies’ plan to meet increased electricity demand relied too heavily on fossil fuels.

“There need to be protections in place so that existing customers are not paying increased costs to meet data center demand and for the long-term maintenance of the additional energy infrastructure built to meet that demand,” said Pleasant Prairie resident Charles Hasenohrl.

Xcel Energy to apply for large customer rates in Wisconsin

During an earnings call last week, Xcel Energy CEO Bob Frenzel said the company signed a deal with a large data center in the Upper Midwest that would need 2 gigawatts of new capacity.

He also said the company expects to have contracts for 6 gigawatts of data center capacity signed by 2027 with electric sales and generation ramping up into the 2030s.

Frenzel also said Xcel would seek large load customer rates — serving data centers — in Minnesota, Wisconsin, Colorado and Texas to accommodate data center growth.

In an email, an Xcel Energy spokesperson said the company has not filed a large load rate proposal in Wisconsin, or requested PSC approval for infrastructure projects related to serving large load customers.

“To date, we have filed a large load (rate) filing in Minnesota, and work is underway for similar tariff filings in several of our other states, with filings anticipated this year,” the spokesperson said.

Listen to the WPR report

Alliant Energy proposes custom electric rates for Meta’s data center campus was originally published by Wisconsin Public Radio.