Hermiston residents soon may have data centers to thank for reducing their monthly electricity bills. 

The Hermiston City Council will consider Dec. 8 whether to cut the franchise fee rate for all its electricity customers from 7% to 4%, according to a release. That’s estimated by the city to save electricity customers $40 to $60 per year, depending on energy usage. 

The reason for the rate cut? The rapid expansion of data centers within the city – and their subsequent utility payments – are expected to grow fee collections by up to $2 million per year until 2030, even when reducing rates for all customers. 

“The proposed change would also eliminate the city’s existing economic development incentive program tied to electric utility franchise fees,” the city said in a statement. “Created in 2022 to support data center development, the incentive program triggered significant new revenue for the city but is no longer needed.” 

Under the revised structure, data centers currently operating in the city would no longer be eligible for refunds over the inflation-indexed threshold as part of the incentive program, but would join all other customers in paying the same 4% fee on all power usage.