Nebraska energy law touted by Gov. Pillen, state leaders as development boost

A new law will let Nebraska add electrical generating capacity without burdening ratepayers, officials said Tuesday.

The law, contained in LB1261, has not yet taken effect. But Gov. Jim Pillen, state senators, public power officials and private company representatives held a kind of pep rally in anticipation Tuesday.

Sen. Barry DeKay, who introduced LB1261 for Gov. Jim Pillen, said electrical generation and transmission capacity needs to be expanded for manufacturing, agriculture and computing.

“All of this investment will cost money, and the question is, who is going to shoulder the burden?” DeKay said. “Right now, public power ultimately pays a good chunk of the upfront capital investment for building out these facilities to ensure that those customers can be served. LB1261 ultimately allows private industry to make a large capital commitment to projects of this size.”

The bill creates an exception to public power districts’ ability to take over generating facilities using eminent domain. The exception allows private companies to develop generating capacity on site for industrial customers needing more than 1,000 megawatts of power.

Such customers could include data centers, but Pillen said the state already has more than its share of those, and they use 11.5% of the state’s electricity.

Pillen drew a distinction between data centers, used for business transactions, and artificial computation centers, which he said are needed for AI competition with other countries, including nuclear deterrence. LB1261 makes no such distinction in what projects it allows.

Delette Marengo of Tenaska, an Omaha-based power developer, said power plants can cost up to $3 billion, and the “beauty” of the bill is that Tenaska, not public power districts and their ratepayers, would shoulder that cost and collaborate with the districts.

John McClure of the Nebraska Public Power District said the bill allows private companies to sell power to the grid, but they have to negotiate and go through the public power districts.

LB1261 takes effect July 18.