BOYCE, La. (KALB) - New documents submitted to the Louisiana Public Service Commission show that Cleco, one of Cenla’s largest utility providers, is trying to fast-track a new project to help service Rapides Parish’s incoming data center.On July 1, Cleco submitted an application to LPSC that would, ‘authorize certain contracts, including a specific site contract, as well as certification of transmission interconnection, new generation, and associated waivers for a large load customer pursuant to the Com...
BOYCE, La. (KALB) - New documents submitted to the Louisiana Public Service Commission show that Cleco, one of Cenla’s largest utility providers, is trying to fast-track a new project to help service Rapides Parish’s incoming data center.
On July 1, Cleco submitted an application to LPSC that would, ‘authorize certain contracts, including a specific site contract, as well as certification of transmission interconnection, new generation, and associated waivers for a large load customer pursuant to the Commission’s Lightning Initiative."
Cleco is seeking approval of an Electric Service Agreement (ESA) that would allow them to build a new substation —a natural gas-powered turbine— on their campus in Rapides Parish. This is directly related to their agreement to power the Applied Digital Delta Forge 1 data center being built across the street.
They are expected to provide around 430 MW of energy to the data center, representing what they call a ‘substantial new load in [their] service territory.’ Cleco also sees this as an opportunity to modernize and strengthen their systems.
“Existing customers benefit in several tangible ways, as the Customer [Applied Digital] will pay 100% of the direct transmission interconnection and bridge capacity costs, contributes meaningfully to recovery of applicable riders that would otherwise be borne entirely by other customers, and materially helps cover the cost of new generation that is required regardless. Cleco Power’s economic analyses included in this Application demonstrate that serving this load produces a signifigant net benefit to existing customers and is projected to reduce monthly rider-related charges for residential customers.”
Cleco Power LLC
The company purports that Applied Digital, backed by an unnamed hyperscaler, is taking on incremental costs and risks related to the project, which will dramatically reduce how much of the cost is passed along to other customers.
Their application also promises certain guarantees that would protect current customers if Applied Digital were to go bankrupt, become unable to pay, or if the data center became nonoperational. Were that to happen, the unnamed hyperscaler could take over the obligations of the ESA.
According to testimony from Cleco’s William Fontenot, the suspected hyperscaler for the project is “one of the most creditworthy companies in the world, and that is providing an unconditional parent guarantee backstopping the obligations.”
Cleco also argues that even without the new data center, the turbine would need to be built within the next four years to phase out some of its older infrastructure.
By building it now, residential customers can take less of a cost hit from it by having the data center and the hyperscaler foot the bill for most of it.
Cleco Power’s application estimates permanent electricity service to begin in mid-2027 and ramp up to full power in 2028.
“[This project] signals to the global digital infrastructure market that Louisiana, and central Louisiana in particular, can compete for the most hyperscale projects on the strength of its workforce, regulatory framework, and reliable electric service.”
Cleco Power LLC
Want to learn more about the impacts of the data center? View our in-depth reporting here.
View the full ESA below:
Public Version of Application for Authorization for Cleco Power LLC by jkinder
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