Avista Corp. (NYSE: AVA) announced it has paused negotiations for energy service to a 500-megawatt data center developer while seeking broader policy coordination and addressing community feedback.

The utility company said the decision follows community interest and concern related to its previously announced memorandum of understanding with the data center developer. Avista is now working with governmental agencies to create a coordinated planning process for large data center energy requests.

"We've heard the questions and concerns from our customers, community members and local leaders, and we take that feedback seriously," said Heather Rosentrater, Avista President and CEO. "This input has demonstrated a need for a broader coordinated planning effort, which Avista will actively participate in."

The Spokane-based utility serves 429,000 electric customers and 386,000 natural gas customers across 34,000 square miles in eastern Washington, northern Idaho and parts of Oregon. As a regulated utility, Avista is required to review service requests, including large proposals, while developers must secure necessary permits separately.

Avista outlined principles for evaluating large data center requests, including ensuring existing customers do not pay costs for serving new large customers, maintaining system reliability through required engineering studies, obtaining regulatory approval for service agreements, and requiring projects to deliver net benefits for customers.

The company noted that while it has served large load customers for 137 years, current data center requests represent unprecedented scale and require new planning considerations. Multiple stakeholders beyond Avista, including developers, infrastructure partners, regulators and communities, are involved in project approval processes.