Private Electricity Grids Meeting the Data Center Moment

Economy |
By Avery Frank | Read Time 2 min

Private electricity grids, also known as consumer-regulated electricity (CRE), are a free-market policy idea that allows private entities to meet the demand of new large-load users like data centers entirely off the ratepayer-supported grid.

Private electricity grids can benefit average ratepayers, developers, and government institutions like the Missouri Public Service Commission (MPSC) by shifting some of the risk and need for new electricity onto private investors, while also giving those investors the benefit of reduced regulation and quicker speed to operation.

This has been an idea I have been beating the drum on for a long time. But recently, private electricity grids have started to be used in practice.

In Ohio, the Socrates South natural gas plant began operation in the summer of 2026. This 200 MW private power plant was built by a natural gas company to serve a Meta-affiliated data center entirely off the grid. It was put online in an astounding 17 months. That is business speed, not bureaucratic speed. Cato Institute Director of Energy Travis Fisher and his colleague Michael Abi-Nader report that the typical permitting timeline for natural gas projects in that regional grid system is 7.4 years.

For data centers and other large-scale electricity users, speed matters. The sooner the necessary power infrastructure is in place, the sooner these companies can begin or expand business operations.

Private electricity grids can have quicker timelines because they are exempt from a plethora of public utility regulations that are used to protect captive, residential ratepayers on a shared, regulated grid. Ohio passed legislation allowing off-grid plants to avoid the huge waiting list for grid connection.

Missouri should stop trying to attract investment with generous taxpayer-supported subsidies and instead turn to the free market to help give industrial developers something increasingly valuable: electricity.

In the modern economy, and in a time when national energy emergencies have been declared and companies like Microsoft are buying entire nuclear power plants for operations, electricity is a vital currency.

Ohio showed us that private electricity grids are not just a theory. They are a viable policy solution that Missouri should consider.

Thumbnail image credit: Ramon Cliff / Shutterstock
Avery Frank

About the Author

Avery Frank earned a Bachelor of Arts degree in economics (with honors) and political science from Sewanee: University of the South in 2022. He also studied at the London School of Economics in 2021 and was inducted into the Phi Beta Kappa and Pi Sigma Alpha Honor Societies. His research interests...

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