Newsom clamps down on California data centers as voters turn against the industry

California Governor Gavin Newsom signed seven new data center bills into law on Monday, marking a significant shift towards regulating the industry. The legislation addresses growing public backlash and aims to transfer electric infrastructure costs from residential customers to data center operators, mandate disclosures of water usage and other resources, and remove environmental review exemptions for data centers. This move contrasts with the governor's previous vetoes of similar bills and is attributed to intensifying public opposition across the state, with Assemblymember Diane Papan noting a changed atmosphere where localities are considering or enacting data center bans.

The new laws have been met with mixed reactions. Environmental advocates, like Arnab Pal of Deploy Action, view them as a positive step toward protecting consumers from utility rate increases and environmental damage, while also suggesting more could be done to benefit everyday people. Conversely, industry groups like the Data Center Coalition, which includes Google, Microsoft, and OpenAI, express concerns that increased regulation could deter data center development in California, despite acknowledging the need for responsible growth. The Coalition highlights the industry's economic contributions to the state, including jobs and tax revenue. The legislative action in California is part of a broader national trend, as other states and Congress also consider similar regulatory measures amidst widespread public opposition to data center construction in local communities.