ATLANTA—As a growing number of electricity-gobbling data centers spring up in electric cooperative service territories, Georgia co-op leaders offered advice at PowerXchange on how to serve these new loads while protecting existing consumer-members from getting stuck with the bill for system upgrades.

“Not a week goes by that we don't have a data center calling us and inquiring about coming here," said Gary Miller, president and CEO of GreyStone Power Corp. in Hiram, Georgia. He said the influx of data centers began about two years ago. “We in Georgia are ground zero for what's happening."

Four data centers have moved into GreyStone Power's territory west of Atlanta so far, creating the largest loads served by the 132,000-member co-op, Miller said.

“They will be 50% of our revenue when fully operational," he said.

While the revenue boost can be a great opportunity for co-ops, it comes with risks that must be confronted head-on, Miller said.

Before GreyStone Power makes a deal to provide power to a data center, the co-op requires the company to provide a cash deposit, an irrevocable letter of credit and a guarantee from the data center's parent company. Many data centers are owned by tech giants, including Google, Amazon and Meta.

It's important to find out exactly how much power a data center requires and how quickly the business needs it, said Miller, adding that the companies are typically in a rush to get started.

“We tell them: 'We're going to bill you for that amount of power whether you use it or not,'" Miller said. “That usually gets them to focus on what they actually need."

Data centers must pay for new substations, transformers and other infrastructure investments needed to fulfill their power demands, he said.

Barbara Hampton, president and CEO of Georgia Transmission Corp., said prior to the signing of a retail sales agreement with one of its members, GTC requires 100% upfront payment for any transmission and distribution equipment being ordered. After an agreement is signed, a minimum of a 25% upfront payment is required for the specific substation being installed for that customer. 

“Know what your service parameters are and don't move off of them," she advised other co-ops. “If you hold firm, you'll be better off."

Miller also warned co-ops to beware of real estate developers and other speculators who try to get a deal on power costs in order to attract a data center as a client.

“We want to know who the contract tenant for the data center is," he said. “That's who we're going to do business with."

Allison Hamilton, NRECA's director of markets and rates, said the national association is working to develop a toolkit to help co-ops with the challenges and opportunities of serving data centers. NRECA also published a report on the topic last April.