As communities across California move to ban or pause new data centers, Governor Newsom has signed seven laws requiring operators to disclose water use, cover grid upgrade costs, and face additional environmental review.
Governor Gavin Newsom signed seven bills into law Monday that impose new requirements on California’s growing data center industry, as communities around the state push back against the facilities’ demands for electricity, water, and land. As CalMatters reports, the laws require data center operators to foot some of the infrastructure costs, and developers must now provide local officials with more information about resource use.
Three of the bills reportedly address electricity costs. Senate Bill 1168, Senate Bill 886, and Assembly Bill 2383 require the California Public Utilities Commission to establish rates that make data centers pay for the costs of connecting to the grid and any upgrades needed to provide them with electricity. The measures also include requirements related to energy procurement and clean energy.
Three other bills deal with water and resource disclosures, per CalMatters. Assembly Bill 2469 prevents local governments from approving new or expanded data centers until developers disclose projected water use, while Assembly Bill 2619 requires data center operators to report estimated or actual water sources and consumption. Assembly Bill 1577 also establishes new reporting requirements for data centers.
The remaining measure, Senate Bill 887, removes data centers from blanket environmental review exemptions, although projects that meet state standards for water and energy conservation can receive a streamlined review.
The legislation comes after months of growing opposition to new data centers in California and across the country, driven in part by concerns about the electricity and water demands associated with the rapid expansion of AI. According to the Sacramento Bee, a July Public Policy Institute of California poll found that nearly three-quarters of Californians opposed building an AI data center in their community, while 63% said they were concerned about the environmental effects of constructing more of the facilities.
California has nearly 300 existing data centers, with another 54 reportedly in the pipeline, according to an analysis by the Pew Research Center. San Francisco and Oakland are considering temporary moratoriums on new data center projects, while Oakley, Gilroy, and Richmond have already enacted them.
KQED reports that Newsom vetoed a bill last year requiring data centers to disclose water use, citing concerns about imposing rigid reporting requirements without fully understanding the effect on businesses and consumers, but this year signed similar water-disclosure legislation.
Newsom said the new rules would give communities more information about proposed projects while preventing data center operators from shifting their costs onto Californians.
“We know that we don’t have to sell out Californians or sacrifice our well-being to innovate and succeed,” Newsom said in a statement. “California has proven that time and time again.”
The bills reportedly passed the Democratic-controlled Legislature largely along party-line votes, with opposition from business groups including the Data Center Coalition, whose members include Google, Microsoft, and OpenAI. The coalition has argued that additional regulation could make California less competitive for data center development.
Per KQED, Nvidia CEO Jensen Huang also acknowledged the backlash surrounding the rapid expansion of data centers, acknowledging that technology companies should have engaged with residents before proposing projects in their communities.
Related: East Bay Official Says She’s Gotten Death Threats Over Huge New Data Center Near Contra Costa Canal
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