Senator Tom Cotton introduced the Decentralized Access to Technology Alternatives Act on January 7, 2026, proposing to exempt certain self-contained power systems from federal electricity regulation. The bill, S. 3585, would create a new category of electric utility called a “consumer-regulated electric utility” that can generate, store, and distribute electricity to large loads without oversight from the Federal Energy Regulatory Commission or the Department of Energy. The target beneficiaries are AI data centers, which now consume enough electricity to strain national grids. Representative Nick Begich of Alaska announced plans to introduce a House companion bill.
The qualifying condition is physical isolation. A consumer-regulated electric utility must serve only new electric loads not previously supplied by any retail electricity provider, and must remain entirely disconnected from the bulk-power system and all regulated utilities. If a facility connects to the grid for primary or backup supply, its exemption terminates immediately.
Cotton framed the bill as a competitive necessity, arguing that the United States faces a capacity bottleneck for AI infrastructure and that existing federal regulations were not designed for on-site, self-contained power systems.
The exemptions are broad. A qualifying facility would be free from FERC rate regulation, reliability standards, interconnection rules, and transmission planning requirements. The bill was referred to the Senate Committee on Energy and Natural Resources. It has no cosponsors and no scheduled hearings.
The opposition spans regulatory, environmental, and consumer interests.
Electric utilities view the bill as a revenue threat. If large industrial loads migrate off-grid into bilateral power arrangements, the fixed costs of maintaining grid infrastructure shift to residential and small business ratepayers. Arkansas state representative Hallie Shoffner criticized Cotton for proposing to deregulate energy infrastructure specifically for data centers. Consumer advocacy groups raised the same cost-shifting concern.
The Competitive Enterprise Institute formed a coalition urging Senate support. Proponents argue the bill increases competition and removes barriers that slow deployment of the computing infrastructure the country needs.
The DATA Act arrives in a crowded legislative space. The House passed the SPEED Act on December 18, 2025, a bipartisan permitting reform bill that shortens environmental review timelines to 150 days for major energy and data center projects. Texas Senate Bill 6 takes the opposite approach, requiring new loads over 75 megawatts connecting to the state grid to participate in demand response. Cotton’s proposal occupies a third position: not permitting reform, not grid management, but regulatory exemption for facilities that bypass the grid entirely.
The bill sits in committee. Its practical significance depends on whether the energy industry’s opposition and the absence of cosponsors reflect a lack of political support or merely an early stage in a longer legislative process.
