The three ways power gets charged
There are only three billing models in common use, and a quote will be one of them or a blend. The difference between them is not the price. It is who carries the risk of the gap between what you reserve and what you draw.
| Model | How the bill is built | Who carries the risk |
|---|---|---|
| Committed kW | A monthly rate per kW of contracted capacity, paid whether or not you draw it | You |
| Breaker or circuit | A price per circuit, set by the breaker rating rather than by your load | You |
| Metered draw | A base fee plus measured consumption, usually with a monthly minimum | Shared |
Committed kW dominates wholesale and most multi-megawatt retail deals. Circuit pricing dominates cabinet and cage deployments. Genuinely metered billing is the rarest of the three, and where it exists there is almost always a floor that makes it behave like a commitment until you grow into it.
Ask: "if I draw half of what I contracted, what does my invoice say?" If the answer is the same number, you are on committed kW no matter what the proposal calls it. That is not a trap, it is how the operator finances the building, but it should change the capacity you commit to.
The 80 percent rule, and why your circuit is smaller than it looks
This is the most common surprise on a first colocation invoice, and it is not the operator being clever. Standard-rated circuit breakers serving continuous loads are commonly applied at no more than 80 percent of their rating. A 20 amp circuit is therefore a 16 amp circuit in the usual cabinet configuration. A properly engineered 100-percent-rated assembly is an exception, so confirm the circuit design rather than assuming. Schneider Electric documents the standard 80-percent application.
| Circuit | Nominal | Usable at 80 percent | What that runs |
|---|---|---|---|
| 20A at 120V | 2.4 kW | 1.9 kW | A light cabinet, network gear, older 1U servers |
| 30A at 208V | 6.2 kW | 5.0 kW | A typical enterprise cabinet |
| 50A at 208V three phase | 18.0 kW | 14.4 kW | A dense cabinet, virtualization or storage |
| 60A at 415V three phase | 43.1 kW | 34.5 kW | High density and GPU deployments |
You are usually billed on the nominal rating. You can only use the derated figure. Take a quote for "two 30 amp circuits" at 208 volts, single phase. That is 12.5 kW of nominal capacity and 10 kW after derating, but only if the two circuits run separate equipment. If they are an A and B pair, the usable figure is 5 kW. The next section explains why, and it is the first thing to settle before comparing two proposals.
A and B feeds double the story
Nearly every colocation deployment is fed twice, so that losing one path does not lose the load. How those two feeds are billed varies more than anything else in a quote, and it is where two proposals at the same headline rate stop being comparable.
A redundant pair protects the load. It does not double it. The usable power of the pair is set by the primary circuit's volts, amps and phase, and the total draw across both circuits has to stay under that figure so either one can carry the whole cabinet alone when the other feed fails. Equinix documents usable power for a redundant pair this way. So two 30 amp, 208 volt circuits fed A and B give you 5 kW you can count on, not 10. Run 8 kW across them and both circuits look fine until one feed drops, and then the surviving breaker trips.
- Billed on total installed capacity. Both feeds are charged, so a deployment with 5 kW of protected load is billed as if it were 10 kW. Common in retail and cabinet pricing.
- Billed on usable capacity. You pay for 5 kW and the redundancy is built into the rate. Common in wholesale, and the reason wholesale rates look higher on a raw comparison.
- Primary plus a redundancy premium. One feed at the headline rate, the second at a discount. Ask what the discount is, because it is negotiable and frequently is not offered unless raised.
Convert every quote to one total monthly cost per usable kW. That means the derated circuit capacity, both feeds counted the way that quote counts them, and cooling and cross-connects included or excluded consistently. Two quotes that look 20 percent apart routinely land within a few percent once they are on one basis, and occasionally the cheaper headline is the more expensive deal.
What the rate does and does not include
The word "power" in a colocation quote covers a different set of things at every operator. These are the five that move the total most, and every one of them should be answered in writing before signing.
Cooling
Sometimes inside the kW rate, sometimes a separate line, sometimes a share of facility overhead recovered through a factor. A power rate that excludes cooling is not comparable to one that includes it.
Utility pass-through
Many contracts pass utility rate changes straight through. Ask which index, how often it can move, whether there is a cap, and how much notice you get.
Escalators
An annual uplift on the power rate compounds over a five or seven year term. A 3 percent escalator on year one is a materially different deal by year seven.
Ramp and burn-down
If you are growing into the commitment, the ramp schedule is worth more than the rate. A twelve month ramp on a 500 kW commitment can be worth more than the discount you were arguing about.
A higher rent can come with cheaper electricity
| Cost | Nash data hall | County's area comparison |
|---|---|---|
| Data hall rent, per kW/month | $210 | $147–$175 |
| Electricity, per kWh | About $0.14 | $0.21–$0.22 |
The county accepted above-range rent citing lower electricity costs. Compare both lines using your expected consumption; rent alone cannot establish the cheaper offer.
Source: LA County's adopted April 7, 2026 board letter. Rent converted from annual figures. The comparison is the county's market survey, not a broker index. Cross-connects are $150/month each; the renewal has a 3% annual escalator from July 2027.
Stranded capacity is where the money actually goes
The single largest source of colocation overspend is not the rate. It is the gap between the capacity committed and the load actually drawn, paid for every month of the term. Enterprise deployments frequently draw well under half of what they reserved, because the commitment was sized from nameplate ratings on equipment that never runs at nameplate.
The fix is unglamorous. Size the commitment from measured draw at your current site rather than from the sum of power supply labels, then negotiate the right to grow rather than paying up front for headroom you will reach in year three. Operators would generally rather sell you a ramp than lose the deal, and the ramp is rarely offered unless asked for.
What two signed contracts actually charge for power
Operators do not publish what they charge. Public bodies have to publish what they sign. Two of those contracts show power billed the two common ways, with every line priced.
Circuit pricing: Miami-Dade County at Equinix MI1
Miami-Dade County rents a 12-cabinet private cage at Equinix MI1. Power is sold by the circuit. A and B circuits are billed at the same price.
| Line (monthly) | 2024 | 2026 |
|---|---|---|
| 208V 30A single phase circuit, each | $787.50 | $868.22 |
| 208V 30A three phase circuit, each | $1,176.00 | $1,296.54 |
| 120V 20A circuit, each | $203.00 | $223.81 |
| 12-cabinet cage with circuit power, total | $37,612.00 | $41,467.30 |
| Per cabinet (our calculation) | $3,134 | $3,456 |
Every price rose exactly 5 percent a year, which is the order's escalator. Use the 80 percent rule above on a 208V 30A A and B pair. It gives about 5 kW you can use. In 2026 that pair costs $1,736 a month, or about $347 per usable kW for the circuits alone, before space. Power drawn over the cage's cap can be billed at up to twice the normal rate.
Committed kW: City and County of Denver at Flexential
Denver's contract buys a cage on a kW commitment with power included. There is no separate metered power bill.
| Line | Monthly charge (USD) |
|---|---|
| Cage: 541 sq ft, 99 kW committed all-in, 11 circuits at 208V 30A, a hold on 433 sq ft more, biometric reader | $20,243.75 |
| Per committed kW (our calculation) | about $204 |
| Half cabinet (20U) with one 120V 20A circuit | $625.00 |
| Fiber cross connect, each | $225.00 |
Prices rise 2 percent a year. If the utility raises its rate, Flexential can raise the electricity charge by the same percentage on 30 days' notice. The first four months were free. These are 2019 prices. With the 2 percent escalator they would be about $22,800 a month for the cage by 2026 (our estimate).
They are not like for like. The markets, years and products differ. But they show what the billing model does. Miami-Dade pays for each circuit whether it draws 1 kW or 5. Denver pays for 99 kW whether it draws it or not. The escalators matter as much as the rate. By year five, the Equinix prices are about 22 percent above year one. The Flexential prices are about 8 percent above. For a third signed rate, Galveston County pays $250 per kW per month at Fibertown, on our public sector pricing page.
Sources: Miami-Dade County Resolution R-1120-23 with the signed Equinix order, PDF pages 8 to 13, and Resolution R-389-26 with the 2026 price schedule, PDF pages 33 to 40. Denver resolution 19-0589, Master Services Agreement and Exhibit A, PDF pages 24 to 27, and the 2024 amendment extending it to 2029. Verified October 13, 2026. Per-cabinet, per-kW and escalator figures are our calculations from the listed prices.
The questions that make an invoice match the quote
- Is the quoted kW committed, or metered, and what is the monthly minimum?
- Is the figure nominal breaker capacity or usable capacity after derating?
- Are A and B feeds both billed, and at what rate each?
- Is cooling inside this rate, or is it a separate charge or a recovery factor?
- Does the contract pass utility rate changes through, against what index, with what cap and what notice?
- What is the annual escalator, and does it apply to power, to space, or to both?
- What does it cost to add a circuit later, and is that fee schedule contractual or at list price on the day?
- If I never exceed half my commitment, is there any mechanism to reduce it?
Apart from the two signed contracts above, this page describes billing structures rather than rates. For what those rates run by market, see the pricing benchmarks, which carry only published figures with their sources, or the colocation pricing guide. Terms vary between two buildings owned by the same company.