Pay for 85% Whether You Use It or Not: Ohio's Data Center Tariff Becomes the National Template

On July 9 the Public Utilities Commission of Ohio approved a tariff that changes the deal between a utility and its largest new customers. Under AEP Ohio's data center tariff, new data centers and expansions larger than 25 MW must pay a minimum monthly bill based on at least 85% of the demand they expect to need, whether or not they use it, for up to 12 years including a four-year ramp-up period. The commission ordered AEP Ohio to file updated tariffs and lift its moratorium on connecting new data centers as soon as possible.

The tariff took effect on July 23. The minimum monthly bill for a new data center is based on a percentage of either its highest monthly billing demand over the previous 11 months or its contract capacity. The commission adopted the settlement agreement largely as proposed in October 2024, with one modification: it requires the data center customer or its financial sponsor to put up collateral, provided the sponsor is a co-signer on the contract.

The tariff page that AEP Ohio published after the order adds operational detail. Every new data center request must go through an online application, and loads of 25,000 kW or more pay a one-time load study fee of $10,000 to $100,000 depending on size. The tariff answers a question that every utility facing data center growth must answer: what happens if the load does not show up? To serve a large data center campus, a utility may need new substations, new transmission lines and, in a vertically integrated state, new generation.

An 85% minimum charge for 12 years shifts most of that risk back to the developer. A customer that books more capacity than it needs pays for it anyway. Central Ohio sits in PJM, and the tariff matters beyond AEP Ohio's own distribution system. The AEP Ohio tariff is likely to be cited in proceedings across the country, for three reasons. The deeper message is about who bears the risk of the AI build-out.