New Study: Fair Share Agreements in Iowa, Wisconsin Support Customer Affordability
A new study found that fair share agreements not only protect existing customers from cost increases - they help ease price pressures by paying for grid upgrades and spreading fixed costs across a larger base.
Fair share agreements with large load customers “place downward pressure on average prices” for all customers when implemented correctly, according to a new analysis from The Brattle Group.
The study, commissioned for Alliant Energy, looked at large load demand in Iowa and Wisconsin. It found that tariffs and contracts that ensure hyperscalers and large customers pay their fair share not only protect existing customers from cost increases - they help ease price pressures by paying for grid upgrades and spreading fixed costs across a larger base.
As of June, regulators in 24 states - including in Iowa and Wisconsin - had approved at least one large load tariff, which electric companies use to ensure residential customers don’t subsidize energy infrastructure needed to serve data centers. Decisions are pending in an additional four states.
“Our analysis shows that affordability outcomes will depend significantly on how utilities structure rates, contracts, and cost allocation mechanisms,” Brattle Principal Ryan Hledik, a coauthor of the report, said in a statement. “When incremental revenues from large customers meet or exceed the costs they impose on the system, existing customers can be protected while communities still benefit from economic development and infrastructure investment.”
The study noted that states experiencing the fastest electricity demand growth have historically seen the largest declines in inflation-adjusted electricity prices. Its findings add to a growing pool of research suggesting data centers and large load customers do not drive up electricity prices for customers when electric companies implement tariffs and other specialized contracts to protect customers.
A separate recent analysis from Lawrence Berkeley National Laboratory and The Brattle Group found that “state-level load growth was linked to declining all-sector average retail prices in recent decades, including from 2019 to 2025, in most states.” And, earlier this year, a Charles River Associates study similarly found that electricity rates have remained broadly stable in most states and have generally tracked inflation over time. Outside the PJM Interconnection region, it found that customers have largely been shielded from cost increases related to data centers.
Alliant Energy is in the midst of a five-year rate freeze in its Iowa service territory that was made possible by data center and large load investments in the grid. Similar rate freezes have been approved in Alabama and proposed in Michigan, Wisconsin, and other states.
An Alliant Energy-supported data center project in Cedar Rapids, Iowa, and the benefits it has provided to the surrounding community were the focus of a recent episode of the Electric Perspectives podcast. Learn more at electricperspectives.com/podcast.