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Portland General Electric is asking utility regulators to approve a massive, 29% increase for data centers as it implements the Power Act, a new law meant to ensure that the energy-hungry industry pays its fair share.
Residential customers would see a 1.3% rate cut under PGE’s proposal. Most businesses would enjoy lower rates, too, though all the proposed rate cuts are below 4%.
The proposed rates, which would take effect June 10 pending approval from the Oregon Public Utility Commission, come after state regulators this spring signed off on a major overhaul of how the utility charges data centers for power.
The Oregon Citizens’ Utility Board, a nonprofit watchdog organization that advocates for utility customers, said the new rates show that households and small businesses had been subsidizing the cost of data centers’ energy thirst.
“Even without a big decrease in rates today, this marks the beginning of a big win for Oregon households,” said Charlotte Shuff, a spokesperson with the board. “The significant increase in data center rates confirms our belief that data centers were not paying for the costs incurred to serve them.”
Between 2019 and 2025, PGE’s residential rates cumulatively rose by 61%. And as of April, residential customers and small businesses saw about a 5% additional rate increase, on average. The Power Act-related decreases will slightly offset those previous increases.
Some power planners have said data centers were no more than a modest factor in driving those earlier increases, but CUB said the new Oregon law should help insulate other customers as the tech industry’s demand for electricity continues to increase in the years ahead.
“With the new rate structure, we should see a slowdown in the significant increases to home PGE bills,” Shuff said.
The Power Act created a legally distinct customer class for large data centers served by investor-owned utilities and gave Oregon regulators authority to ensure the big energy users cover the cost of new power plants and transmission lines to meet their growing electricity demand. Data centers in eastern Oregon are served by electric cooperatives, which already had the freedom to allocate data center costs directly to data centers.
PGE’s data center customers are concentrated in Hillsboro, where the industry occupies 436 acres, with 50 more acres of new construction planned or underway. The city says data centers operate on 21 different sites there.
PGE says its data center load increased from 50 average megawatts in the spring of 2020 to more than 300 average megawatts in the second quarter of 2025. That’s equivalent to the power use of about 240,000 homes.
Most of Hillsboro’s data centers are run by specialist companies who host computers for other tech companies. Their clients include many of the biggest names in technology, among them Meta, TikTok, LinkedIn and the social network X.
In testimony to regulators, PGE said the new data center customer class that will be subject to higher rates currently includes five companies and 16 data center sites. It did not identify them.
Flexential, one of the major data center operators in Hillsboro, said Thursday it is still reviewing PGE’s filing and isn’t ready to comment. Two other companies with large Hillsboro footprints, QTS and Digital Realty, did not immediately respond to inquiries.
Hillsboro is contemplating a “pause” on new data center development following intense community blowback over the tech industry’s consumption of energy, land and tax incentives. The city council will discuss a moratorium at a special meeting June 9.
Protestors at the Hillsboro Civic Center before a city council work session on data centers on June 2, 2026.Mike Rogoway/The Oregonian
While residential rates are only falling a little bit, Shuff said that’s because the small decreases for residential and other customers mostly reflect how costs are spread across a large pool of ratepayers. Because there are many Oregon households and small businesses, even significant cost shifts result in only modest changes for each customer, she said.
Under the Power Act, PGE will reassess data centers’ impact every few years when it files a general rate case. That could lead to further rate changes, which will depend on how much cost data centers add to PGE’s system.
PacifiCorp is also required to develop its own rate design for data centers. Its implementation remains an open, contested proceeding before the utility commission, with regulators expected to issue an initial ruling this summer. PacifiCorp must have special rates for data centers in place by 2028.
Gosia Wozniacka is an environmental justice reporter. She covers climate change, clean energy and electrification policies, pollution, wildfires and the wild world we inhabit. Her work also explores climate... more
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