California Gov. Gavin Newsom has signed seven bills into law imposing new requirements intended to increase transparency and oversight of the data center industry.
Each of the laws covers some component of the industry, such as electricity and water usage, rate structures and environmental review.
As AI and cloud computing continue to expand, data centers are continuing to appear, and meeting their electricity needs is increasingly important to their growth, especially as large-scale and hyperscale data centers come online. The new laws will require data centers to pay their share of grid upgrade costs without passing those costs on to other ratepayers. The laws also address electricity generated onsite, requiring data centers to report their expected electricity use and onsite generation.
Other laws for data centers involve the use of water for cooling systems that generate enormous amounts of heat. In California and some other states, conserving enough water for homes, businesses and agriculture can already be a common concern. The new laws will require data centers to provide local governments and water suppliers with information about expected water use, water supplies and efficiency measures, as well as plans for managing water use during drought conditions. Data centers also will be responsible for the full cost of certain water infrastructure improvements needed to serve their projects.
Additionally, data centers will have to meet new environmental review requirements and, for projects seeking certain streamlined environmental approvals, meet standards involving electricity, water and fuel use.
Those projects also will have to pay for the electrical connections and grid upgrades needed to serve them, rather than passing those costs on to other ratepayers.
Photo by Brett Sayles from Pexels
For more of the latest from the expansive government marketplace, check Government Market News daily for new stories, insights and profiles from public sector professionals. Check out our national contracting newsletter here.
