Electric power distribution company Entergy has announced that customers in Mississippi will save more than $2 billion on power bills due to data center projects in its service range.
Entergy Mississippi customers join those in Louisiana and Arkansas as the largest recipients of a broader $5 billion in savings. The company’s announcement comes after Amazon Web Services announced plans to build a pair of multi-billion-dollar data centers in Madison County and another in Warren County, along with AVAIO Digital settling on Rankin County as a data center destination.
While ratepayers in the areas where data centers are being constructed voiced concerns of bill hikes, Entergy Mississippi President and CEO Haley Fisackerly has maintained that the projects will have the opposite effect on the wallets of utility customers. Fisackerly added that having a big customer — like Amazon — helps offset the rising cost of powering homes, small businesses, and even healthcare facilities.
“When you don’t have growth, and 25% of your customers are below the national poverty level, affordability becomes a big concern,” Fisackerly said on MidDays with Gerard Gibert. “Just like any business or community, you need growth. You need economies of scale. By bringing in a large customer like AWS, they are bringing the volume we need, but they also bring in additional revenues that are going to allow us to invest more to improve reliability.”
Not only is the money Entergy Mississippi is bringing in from data center owners helping customers save money, but it is also going toward major grid upgrades that consumers don’t have to subsidize, Fisackerly said. Efforts by the state legislature, Gov. Tate Reeves, and the Mississippi Public Service Commission paved the way for large companies constructing data centers to contribute to a $300 million “Superpower Mississippi” campaign by Entergy to modernize and improve power lines and systems.
These grid upgrades are expected to reduce power outages, which is a plus in a state prone to year-round inclement weather events, and make services more reliable for customers.
“These large technology customers will help pay the cost for needed power grid maintenance and upgrades that would otherwise have been borne by our existing customers,” Fisackerly continued. “During a rising cost environment, when we are having to replace two half-century-old power plants with new units, securing such relief right now is perfect timing for our residential and small commercial customers.”
Though concerns remain about the environmental impacts data centers will have on the area, along with the possible noise associated with powering them, officials contend that the affordability of utilities can be erased from the list of worries.
Entergy’s existing agreements with data center owners have been structured to benefit all ratepayers, while also protecting existing customers from risks, the company announced. The company included prepayment requirements, multi-year contract terms, credit and collateral requirements, and early termination penalties in contracts with data center owners to protect existing customers.
