Energy Gang Podcast Summary

Episode Title: A solution to the problem of paying for data center power? Unpacking AWS’s recent 3 gigawatt deal with NIPSCO
Date: February 17, 2026
Host: Ed Crooks (Wood Mackenzie)
Guests:

• Brandon Oyer (Head of America’s Power and Water, AWS)
• Vince Parisi (President & COO, NIPSCO)

Episode Overview

This episode dives deep into the challenges and solutions around providing massive amounts of reliable, appropriately funded electricity to support the explosive growth in data center demand. The discussion centers on AWS’s new, groundbreaking 3-gigawatt partnership with Indiana utility NIPSCO, which aims not only to supply AWS’s power needs but also to protect and benefit existing utility customers. The episode also explores whether this model could be replicated as a template for managing data center-driven load growth in the U.S. and beyond.

Key Discussion Points and Insights

1. Backdrop: Data Center Growth and Electricity Demand

• The digital backbone of modern life–from online shopping to medical records to 911 calls–relies on data centers, the demand for which is accelerating due to AI, manufacturing onshoring, vehicle/home electrification, and more.
• The relationship between data center operators and utilities has grown contentious, with concerns over who pays for infrastructure investments and the impact on utility bills for regular customers.
• “If there is power and no data center, then we're not serving our customers. If there's a data center without power, we're not serving our customers.” – Brandon Oyer (00:00, 23:12)

2. Personal Perspectives & Institutional Context

• Brandon Oyer explained his unique background: military (Navy nuke), private energy sector, leading data center ops at AWS, giving him a holistic, “chip to substation” view. (02:17)
• Vince Parisi described his 26-year journey from energy lawyer to senior utility executive, underscoring deep community commitment. (03:31)

3. Concerns Around Cost-Shifting and Local Bills

• Host Ed Crooks highlights that utility and customer concerns about data centers often focus on cost-shifting: new generation/grid costs potentially driving up bills for everyone.
• Oyer stresses the invisible but critical role of data centers in society, arguing AWS wants deals that don’t shift costs to local families—as he puts it:

  “I don't want my family paying the burden from data centers. So we take time to partner with the utilities to design deals and rate structures... responsibly.” (06:56)

4. Why Utilities Partner on Big Deals

• Parisi explains NIPSCO’s excitement about growth—not just for data centers, but from manufacturing and cold storage—emphasizing responsible, community-minded growth. (08:31, 11:07)
• Some utilities shun new load due to capacity concerns, but NIPSCO sees value in thoughtful partnerships, economic development, jobs, and infrastructure improvements.

5. The AWS-NIPSCO “GenCo” Deal: How It Works

• Structure:
  • A separate generation company (“GenCo”) is formed to fund, build, and own new generation assets—3 GW to serve 2.4 GW of AWS data center load, ensuring robust reserve margin.
  • GenCo is incentivized to deliver on-time and at performance targets:

    “If they meet our performance targets and dates, they'll make more than a regulated rate of return ... if they don't ... there's a little bit of downside for them.” – Oyer (14:33)

  • Result: Mutually incentivized, transparent commercial construct.
  • Existing transmission identified as opportunity to leverage infrastructure.
  • The structure is designed so the costs are “completely separated from our customer base,” with savings projected at $1 billion for local customers over 15 years. (21:07)

6. Key Features and Impacts

• This project effectively doubles NIPSCO’s electric system size, all with a single customer, but does so via a transparent, ‘ringfenced’ deal.
• Simple, replicable structure creates clear regulatory separation and confidence for policymakers and the public.
• Large, long-term players (like AWS) willing to invest in communities are differentiated from “opportunistic” data center developers. (14:33)
• The deal’s transparency:

  “When somebody wants to look at the books and records, they can see very clearly how our customers aren't paying for that, but then benefiting to the tune of about a billion dollars.” – Parisi (21:07)

7. Locational/Resource Considerations

• Is power the #1 determinant for data center siting? Oyer says:

  “If there is power and no data center, then we're not serving our customers. If there's a data center without power, we're not serving our customers. If we can't build and find a workforce, we're not serving our customers.” (23:12)

  • Power is essential, but workforce, land, water, fiber, and supply chain are also vital.

8. Timing, Flexibility, and Regulatory Innovation

• Typical mismatch: Utilities want 20- to 40-year stability; tech companies want flexibility. This deal settled on a 15-year commitment with options to extend.

  “We try to get to a point where we can ensure that there's a sufficient amortization schedule ... but also give flexibility where needed as things change.” – Oyer (25:44)

• Regulatory context: Indiana’s regulatory framework, with open-minded legislature and commission, enabled this approach via special contracts and alternative regulation. (30:24)

9. Procurement and Equipment Challenges

• GenCo structure enabled early procurement of long-lead equipment (turbines, transformers), de-risking delivery timelines—much faster than traditional methods. (28:18)

10. Grid Connection vs. “Bring Your Own Power”

• Oyer reiterates AWS’s flexible but customer-centric view:

  “We continue to evaluate all sorts of structures and continue to find that being connected to the grid is the most cost effective way to scale up.” (33:43)

  • Points out that new generation improves regional reliability and spreads fixed costs.

11. Flexible/Data Center Load Management

• On making AWS a flexible/grid-responsive load:

  “Serving AWS customers is different than say a bitcoin mining facility ... We guarantee [customer] availability... We’re not an interruptible load.” (36:29)

  • AWS may provide demand response in emergencies, but as a rule their loads are “firm.”

12. Lessons and Replicability

• Both Oyer and Parisi stress that this isn’t the only model—but that trust, transparency, and shared community values are essential.

  “Sometimes I don't understand how this is so complicated. I'm in the business of buying electricity. I know I have to pay for it. Utilities are in the business of deploying capital, generating a return ... and operating in a reliable manner. We just take that mindset and we go simple.” – Oyer (39:48)

• The deal is reproducible, at least in principle, for the right partners and regulatory environments.
• Parisi emphasizes trust and constant communication as critical to overcoming risk in advancing such deals. (40:03)

Notable Quotes & Memorable Moments

• Brandon Oyer on the symbiosis:

  “If there is power and no data center, then we're not serving our customers. If there's a data center without power, we're not serving our customers.” (00:00, 23:12)

• On cost-sharing and community:

  “I don't want my family paying the burden from data center. So we take time to partner with the utilities to design… responsibly.” – Oyer (06:56)

• On partnership:

  “This is not the only way to do it, it's the right way for us to do it in this moment, to do it at this size and this level and scale and certainly for us, reproducible. Right.” – Parisi (40:03)

• On lessons learned:

  “It's just honesty and transparency are the two things that helped us get through this... Sometimes I don't understand how this is so complicated.” – Oyer (38:46, 39:48)

Timestamps for Important Segments

• Backdrop and Data Center Ubiquity: 05:17–08:12
• NIPSCO's Approach & Community Priorities: 08:31–12:49
• The GenCo Structure and Deal Details: 14:33–17:53
• Regulatory & Procurement Advantages: 28:18–30:24
• Grid Connection vs. Other Models: 33:27–35:46
• Load Flexibility & Reliability Requirements: 36:29–37:59
• Lessons and Replicability: 38:46–41:47

Conclusion

This landmark episode provides a rare inside look at how two industry leaders are solving the new electricity demand challenge posed by mega-scale data centers—balancing the interests of major tech, utilities, regulators, and communities. Honesty, transparency, and partnership emerge as the central themes, with the AWS-NIPSCO deal presented as an innovative but pragmatic blueprint for regions facing similar growth. The conversation remains candid, occasionally wry, and grounded in mutual respect for the complexity—and necessity—of delivering reliable, responsible power for the digital age.