Louisiana Regulators Fast-Track Power Plant Approvals for Data Centers and Major Industries
December 19, 2025
In a significant shift of energy policy aimed at attracting large-scale industrial investment, Louisiana has established a streamlined regulatory pathway for utilities to quickly build power plants dedicated to major electricity consumers like data centers. The move highlights the intensifying competition among states to host energy-intensive industries and the growing pressure on power grids from the rapid expansion of digital infrastructure, particularly for artificial intelligence.
The Louisiana Public Service Commission (LPSC) voted 4-1 on Wednesday to adopt a new rule that creates a "lightning speed" approval process for certain power plant projects. The rule suspends the standard competitive bidding requirement, a key consumer protection designed to ensure cost-effectiveness, and allows utilities to seek approval based on a single proposal. To qualify for this expedited track, a project must involve a utility customer with forecasted electricity demand that exceeds the utility's existing capacity, and the utility must have a 15-year contract to sell the power to that customer.
A central provision of the new framework requires the large-scale customer to fund at least 50% of the new power plant's construction cost, with the remaining cost potentially falling to other utility ratepayers. This marks a departure from a recent high-profile deal involving Meta Platforms Inc. For its massive AI data center under construction in Northeast Louisiana, Meta agreed to cover 100% of the cost for three new natural gas turbines being built by Entergy Louisiana. That dedicated power plant, approved by the LPSC in August after an eight-month review, will have a capacity of 2,200 megawatts—more than double the peak electricity demand of the city of New Orleans.
Proponents, including rule author Commissioner Jean-Paul Coussan, argue that accelerating approvals is essential for economic development. "This could cut our regulatory process down from, say, two years down to eight months," Coussan said, emphasizing that the commission would still act as a backstop to ensure proposals use the "lowest reasonable cost." He framed the rule as aligning with Governor Jeff Landry's agenda to court business with industry-friendly regulations, stating, "I'm trying to create jobs and create a positive national perception of Louisiana for business." The Meta project alone is expected to create approximately 500 direct jobs.
However, the rule faced opposition from consumer advocates and some industrial groups. The lone dissenting commissioner, Davante Lewis, expressed concern that the policy could disadvantage household consumers in favor of "the wealthiest companies in the world." Critics, including the Louisiana Energy Users Group—a coalition of 26 large industrial companies—argued that the 50% cost-share requirement is too lenient. The group's attorney, Randy Young, contended that if competitive bidding is waived, "commit to paying the full cost of whatever generation you need — not just half of it." Logan Burke of the Alliance for Affordable Energy testified that the previous rules were meant to protect ratepayers from bearing the cost of utility investments on which companies are guaranteed a profit.
The rule's adoption underscores a broader tension between fostering rapid industrial growth and maintaining regulatory safeguards for electricity consumers. It also reveals disparate treatment in the regulatory process: while the new framework facilitates fossil fuel plants for specific customers, the LPSC previously imposed a four-year delay and strict limits on a request from the same industrial group to purchase solar power from independent providers.
Source: lailluminator
