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Utility Rates, Grid, and Markets

Distribution

Distribution is the lower-voltage system that delivers electricity from substations to end users. Most very large data center campuses eventually require sub-transmission or transmission-level coordination even if some service is delivered through distribution assets.

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Step-down transformer

A step-down transformer reduces voltage from a higher utility or distribution level to a lower facility voltage. Data center projects may use multiple transformation stages from transmission or sub-transmission down to medium-voltage and low-voltage distribution.

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ROFO

Right of First Offer gives the holder an opportunity to make or accept an offer before the owner markets the property or capacity to others, depending on drafting. It is useful for expansion strategy but weaker than a purchase option because pricing and acceptance may remain uncertain.

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Economization

Economization uses favorable outdoor conditions to reduce mechanical cooling energy. The practical value depends on climate, air quality, humidity, water strategy, controls, and whether the system uses air-side, water-side, or refrigerant methods.

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