BAAJA’s Surprising Bet: Cleaner Data Centers Through Grid Access

The Senate permitting deal is drawing criticism for its potential to speed up gas projects tied to artificial intelligence. Its strongest defense rests on a different possibility: making large data centers connect to the grid, pay their full costs, and help build the cleaner power system they currently lack.

The Bipartisan American Affordability and Jobs Act, or BAAJA, has become part of the data center fight even though the bill was written as a broad infrastructure and energy permitting package. Environmental groups warn that faster reviews could unlock gas plants, pipelines, and federal land development for the AI boom. Supporters of the deal see a more specific opportunity. They argue that clear grid rules could pull data centers away from isolated, gas-fired power plants and into a system where utilities, regulators, and other customers can see the costs.

That theory depends on details buried in a bill spanning hundreds of pages. BAAJA would require covered high-density computing facilities with electric demand of at least 20 megawatts to pay the full incremental cost of serving them. Those costs could include generation, storage, transmission, and distribution equipment that would have no reason to exist without the new load. Developers would also have to provide financial assurances or contributions before utilities build the upgrades.

The arrangement could change the basic decision facing a data center developer. A project could pay for a predictable grid connection, or pursue an onsite power plant that offers speed and control while shifting more environmental and infrastructure risk onto the surrounding region.

Large AI data centers need enormous, steady supplies of electricity. Their power demand can exceed that of a small city, and developers often want a connection years before a utility can complete new generation and transmission. Interconnection queues are already crowded. Transmission lines face years of planning, environmental review, state approvals, and litigation. A developer facing that timeline has a strong reason to build generation behind the fence.

Natural gas is especially attractive in that setting. Gas turbines can run around the clock, occupy relatively little land, and provide a familiar source of firm power. A data center owner can pair the plant with a pipeline or fuel deliveries and avoid waiting for a regional grid expansion. The approach also gives the operator direct control over reliability, an important selling point for facilities running computing workloads that cannot tolerate interruptions.

BAAJA’s proponents argue that the bill could improve the grid option in several ways:

Grayson Flood, a senior fellow at Groundwork Collaborative and a former legislative director for Representative Alexandria Ocasio-Cortez, has made this case directly. He said data centers may have a greater incentive to connect to the grid if the bill reduces barriers to service. He also points to the cost of building behind the fence, which studies have found can approach twice the cost of connecting to the existing system.

“At the end of the day, if you want these data centers to be powered by clean, firm capacity, anything from solar and storage to wind and storage to nuclear, geothermal, and hydropower, you’re going to need to have a grid that can bring those sources to the data centers,” Flood said. “Right now we really don’t have that.”

That is the surprising part of BAAJA’s data center logic. A law that speeds up some fossil fuel infrastructure could also make the shared grid more useful to the companies driving the new demand. A connection to a larger power system gives a data center access to a changing mix of electricity over time. An isolated gas plant locks the project into a particular fuel arrangement for decades.

BAAJA offers a contested answer to the data-center power problem: make large computing facilities pay the full cost of the grid infrastructure they require, while speeding the transmission needed to serve them with a broader and potentially cleaner power mix. The proposal could make grid connection a more credible alternative to dedicated gas plants, but its wider permitting changes could also hasten fossil-fuel infrastructure. Its climate case therefore rests on execution—whether transmission, utility oversight, and clean-power procurement move faster and more effectively than gas development.

The bill’s data center provisions aim to prevent a familiar cost problem. A utility may build a substation, transmission line, or new generation capacity for a hyperscale customer, then spread the expense across all ratepayers. BAAJA would put the incremental bill on the large customer that caused the need.

Covered facilities would include data centers and high-density computing sites with demand of at least 20 MW. The framework would also reach phased developments expected to reach that threshold and certain sites under common ownership or control. Customers would remain responsible for unrecovered incremental costs if they end service early.

That last provision matters because data center plans can change quickly. A developer may announce a massive campus, obtain preliminary approvals, and later reduce the buildout, switch technologies, or abandon the project. Utilities still face the expense of equipment ordered for the expected load. Financial assurances would give utilities a stronger position before construction begins.

The rule could also affect where developers choose to locate. A site with cheap land and generous tax incentives may look less attractive after the full cost of transmission, distribution, storage, and generation is placed on the project’s balance sheet. A site near existing power infrastructure may win even if the land costs more.

Those choices matter for emissions. A data center placed near a robust transmission network can buy power from a broader market and use regional clean energy. A project placed near a gas basin may find it cheaper to build a dedicated plant and arrange fuel supply directly. Requiring full grid costs narrows the subsidy available to the first option, while transmission reforms may improve its practical availability.

BAAJA would broaden the Federal Energy Regulatory Commission’s authority over qualifying interstate transmission facilities. In general, projects would need to operate at 230 kilovolts or above and meet public interest, reliability, and consumer benefit requirements. For facilities of at least 345 kilovolts, federal and state siting reviews could proceed in parallel.

The proposal also directs changes in transmission planning, interconnection, and cost allocation. Renewable energy right-of-way applications would receive firm processing timelines, including a 30-day completeness review and a 90-day deadline to begin an environmental impact statement when one is required. Certain transmission, distribution, and storage projects in existing corridors or previously disturbed areas would receive streamlined environmental review.

For clean energy advocates, these provisions address a real bottleneck. Solar and wind projects can be ready to build while waiting years for transmission. Storage projects can sit near existing lines yet face complicated reviews. A larger grid can move power from regions with strong renewable resources to regions with concentrated industrial demand.

A data center developer does not need every electron to come from a new wind farm. It needs dependable service, credible rules, and a system capable of handling its load. Expanded transmission can provide those conditions while allowing regional power markets to add cleaner resources over time.

The economics remain complicated. Data centers could still demand new gas generation as a bridge or as a source of firm capacity. A transmission line may take longer to build than a gas plant. A utility may also prefer a nearby gas facility when reliability studies show a local need. BAAJA creates pathways for cleaner infrastructure, yet it does not dictate the generation mix that ultimately serves each campus.

A faster permit is not climate policy if the fastest project remains a private gas plant.

BAAJA’s promise depends on turning grid connection into the cheaper, more reliable, and cleaner choice—not merely making every kind of energy infrastructure easier to build.

The concerns from environmental organizations focus on the same provisions that supporters describe as practical reforms. A shorter environmental review, a tighter window for lawsuits, and narrower Clean Water Act authority can reduce delay for a beneficial transmission line. Those changes can also reduce leverage over a pipeline, gas plant, or other project with heavy local impacts.

BAAJA would generally set a 150-day filing window for NEPA claims and move certain challenges directly to federal courts of appeals. For NEPA deficiencies, the usual remedy would be a remand for correction without automatically halting the project. The structure would give developers more certainty after an authorization, while leaving separate substantive environmental requirements in place.

The bill would also limit Clean Water Act Section 401 certification to defined water quality requirements and cap the certification period at nine months for certain natural gas and transmission projects. Its changes to Section 404 would constrain the period in which the Environmental Protection Agency could prohibit or restrict disposal sites for covered applications.

Those changes could help a transmission line cross state boundaries. They could also help pipeline expansions reach gas-fired power plants serving data centers. The bill would streamline certain maintenance, compression, looping, and capacity expansion work in existing interstate pipeline corridors. It would also provide protections against revoking some approved energy facility authorizations.

The League of Conservation Voters and the NRDC Action Fund have responded with a $250,000 advertising campaign focused on the climate impacts of fossil-fuel-powered data centers and Trump administration policies to accelerate their construction. The Wilderness Society has backed a moratorium on data centers on public lands. Earthjustice has reported that 80 percent of data centers under development that plan to bring their own power will rely on gas generation.

Their warning has a concrete basis. President Trump’s push for data centers on federal land has generated interest in sites across states including Arizona, Idaho, Nevada, Oregon, and Utah. The federal land effort remains early-stage, and many announcements represent preliminary interest rather than committed construction. Still, the projects show how federal land, gas generation, pipelines, and AI demand can fit into a single development model.

A Department of Energy project in Ohio offers a sharper example. SB Energy and SoftBank plan to develop 10 GW of data center capacity with at least 9.2 GW of natural gas generation at the former Portsmouth Gaseous Diffusion Plant. The project also promises excess generation and transmission capacity for the broader grid. That combination captures the policy tension: a gas-heavy campus may add power supply for consumers while extending dependence on fossil fuel infrastructure.

BAAJA’s clean-grid theory works best when a data center seeks ordinary utility service. Developers can choose a different route. They can build a power plant behind the fence, locate close to natural gas production, or structure a project around infrastructure that avoids a major federal permit.

Oil Change International has highlighted that strategy in its criticism of the bill. Developers can place facilities in gas basins to access fuel directly and avoid interstate pipelines that require federal approval. Off-grid projects also sit outside some of the cost and planning rules that would apply to grid-connected loads.

That creates a policy challenge. The bill could make grid access more predictable while making certain gas infrastructure easier to build. If gas remains the fastest way to deliver firm power, developers may use the faster route. A transmission reform that takes several years to produce results cannot compete with a gas plant that can be permitted and built on a shorter schedule.

The full cost rule also has a boundary. It can charge a data center for the grid upgrades it causes. It cannot by itself price air pollution, methane leakage, water use, noise, or the climate damage associated with gas generation. Those costs require separate regulations, utility rules, state permits, or federal standards.

Sara Chieffo of LCV has argued that data centers need accountability across environmental, consumer, safety, and labor concerns. That broader agenda remains outside much of BAAJA. The bill addresses how projects move through permitting and how large loads pay for grid service. It does not establish a complete national framework for siting, emissions, water use, or corporate responsibility.

Several practical decisions would shape whether BAAJA produces cleaner data center development.

BAAJA remained a proposal requiring Senate and House action. A Senate vote was expected after Congress returned from its preelection recess on November 9, 2026, and the text could change before any final vote. Implementation would also require agency rules and, in some cases, state action.

The strongest defense of the bill therefore has a conditional form. BAAJA could help clean up data center growth if it produces real grid connections, assigns the full infrastructure bill to large computing customers, and accelerates transmission more effectively than it accelerates gas development.

That outcome would require follow-through beyond a faster permit. It would require utilities to protect ratepayers, regulators to enforce financial guarantees, developers to accept the cost of their demand, and lawmakers to address emissions and community impacts directly. The bill’s supporters are betting that those conditions can turn grid access into a cleaner alternative to private gas plants. The data center boom will test whether that bet survives contact with project economics.