The Illinois state legislature failed in the final hours of its session to pass an energy omnibus bill aimed at storing energy and spurring renewables at a time when data centers threaten to sap the state’s grid and spike customers’ bills.
The latest iteration of the energy bill unveiled Saturday, the session’s last day, included incentives for battery storage and would have lifted a moratorium on the construction of large nuclear power plants in Illinois. Missing from that bill were any restrictions on data centers, which require massive amounts of electricity to operate.
Environmentalists had pushed for measures that would have required data centers to bring in their own energy or pay higher fees to meet Illinois’ renewable portfolio standard, a state program that funds renewable energy development.
Lawmakers and clean energy lobbyists are vowing to resuscitate the energy bill, or at least parts of it, either during a special summer session or the fall veto session. Environmental advocates also emphasized the need for clean energy incentives at the state level while President Donald Trump and congressional Republicans work to gut green energy investments.
“The end of the legislative session was a very difficult environment for a whole host of reasons: difficult budget year, a mass transit funding crisis. So, with so many energy stakeholders involved, it was very difficult for many lawmakers to say yes to anything this past weekend,” said Jack Darin, director of Illinois’ Sierra Club chapter. “But there was clear communication from the legislative leaders that we will keep working on this, because no one disagrees these solutions are needed. There were some stakeholders that just couldn’t quite agree on how exactly to do that.”
If state lawmakers take up energy legislation again, they could come together on incentives for battery storage to relieve strain on the grid. Previous iterations of the omnibus energy bill proposed using a rebate program to incentivize participation in behind-the-meter storage, from the batteries in EVs parked in garages to large storage facilities.
Under the proposed program, customers would send their stored energy to the grid during times of peak demand, which would lower the cost for all customers, according to Samarth Medakkar, policy principal for Illinois and Michigan for the clean energy trade group Advanced Energy United.
Though labor leaders and lawmakers from both parties expressed support for battery storage provisions, the measure received pushback from the Illinois Manufacturers’ Association, which claimed the latest version of the provision would have cost ratepayers $7 billion.
“We’re not opposed to battery storage, but we suggested a different funding mechanism,” said Mark Denzler, president and CEO of the trade group. “We heard the developers and they all said, ‘We can’t find financing.’ So what we suggest, instead of requiring ratepayers to pay it, is finance it through the Illinois Finance Authority.”
Medakkar and environmental advocates, meanwhile, have framed costs related to battery storage as a money-saving investment.
“Once ratepayers are paying for this program, the cost is offset by the increased cost that customers are likely to see if this capacity wasn’t online,” Medakkar said.
Environmental groups will face off against both labor and industry groups if lawmakers try again on legislation regulating data centers’ energy usage in Illinois. Those provisions failed to make it into the latest versions of the bill. Labor groups argued that before any other restrictions are applied to data centers, state lawmakers must address a separate issue with liability under Illinois’ Biometric Information Privacy Act. Data centers could face lawsuits under BIPA if they store biometric data such as facial features and fingerprints without consumers’ consent, according to Marc Poulos, executive director of labor management group International Union of Operating Engineers Local 150.
If the threat of those lawsuits stymies construction of data centers, trade unions would feel the hit.
“Right now, trial lawyers have unlimited liability that they can get class-action lawsuits and sue under. Data centers cannot live with that,” said Poulos. “There’s been proposals back and forth, but every proposal, either the data centers say no way or the trial lawyers say no way.”
Any compromise by labor groups, Poulos added, would depend upon the middle ground that trial lawyers and the data center industry could find. Environmental groups are hoping that Gov. JB Pritzker will put his thumb on the scales and intervene.
“We’re going to heavily need the governor’s leadership and buy-in on this,” said Anna Markowski, Midwest director for climate and energy at the Natural Resources Defense Council. “That might end up happening honestly in a different channel than even directly within any sort of data center legislation. I could see that as a possible avenue.”
That could mean state legislators could amend the Biometric Information Privacy Act in a separate piece of legislation, she added. Pritzker already signed a bill last year making BIPA less punitive following a sweeping data collection lawsuit against fast food chain White Castle. A spokesperson for Pritzker did not provide a comment on the governor’s stance on reforms to BIPA related to data centers.
As lawmakers searched for ways to pump more power into the grid, Illinois’ biggest nuclear booster, Republican state Sen. Sue Rezin, inserted in the omnibus bill a lift on the state’s moratorium on the construction of new nuclear plants. Rezin helped pass similar legislation in 2023 that lifted the state’s moratorium on small nuclear reactors, those limited to a capacity of 300 electrical megawatts or less. Small nuclear reactor technology is largely unproven and has not been employed in the U.S. yet. Energy analysts have also pointed out that they’re cost-prohibitive.
Pritzker signed that bill into law that December after vetoing a version that he said would “open the door to the proliferation of large-scale nuclear reactors.” The governor has since warmed up to the idea of large-scale nuclear plants in Illinois, signaling hope for the measure if it returns this fall.
Rezin felt that her latest measure was bogged down by the wide-ranging energy omnibus and hopes to reintroduce her bill as a standalone during the fall veto session.
“I support battery storage, but what was in the omnibus bill was a large-scale build-out, which is very expensive,” Rezin said. “The state of Illinois has to first and foremost create an environment for capacity. Battery storage is great. It shaves your peaks on any given day for four to seven hours, but this does not replace our capacity generators, which is what we need.”
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